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THE Uttar Pradesh GOODS AND SERVICES TAX

BILL, 2017

A

BILL

to make a provision for levy and collection of tax on

intra-State supply of goods or services or both by the

State of Uttar Pradesh and the matters connected

therewith or incidental thereto

BE it enacted by Legislature of Uttar Pradesh in the

Sixty-eighth Year of the Republic of India as follows:-

CHAPTER I

PRELIMINARY

1. (1) This Act may be called the Uttar Pradesh Goods

and Services Tax Act, 2017.

Short title, extent and

commencement.

(2) It extends to the whole of the Uttar Pradesh

(3) It shall come into force on such date as the

State Government may, by notification in the

Official Gazette, appoint:

Provided that different dates may be appointed for

different provisions of this Act and any reference in any

such provision to the commencement of this Act shall be

construed as a reference to the coming into force of that

provision.

2. In this Act, unless the context otherwise requires,––

Definitions.

4 of 1882.

(1) “actionable claim” shall have the same meaning as

assigned to it in section 3 of the Transfer of

Property Act, 1882;

(2) “address of delivery” means the address of the

recipient of goods or services or both indicated on

the tax invoice issued by a registered person for

delivery of such goods or services or both;

2

(3) “address on record” means the address of the

recipient as available in the records of the

supplier;

(4) “adjudicating authority” means any authority,

appointed or authorised to pass any order or

decision under this Act, but does not include the

Commissioner, Revisional Authority, the

Authority for Advance Ruling, the Appellate

Authority for Advance Ruling, the Appellate

Authority and the Appellate Tribunal;

(5) “agent” means a person, including a factor,

broker, commission agent, arhatia, del credere

agent, an auctioneer or any other mercantile agent,

by whatever name called, who carries on the

business of supply or receipt of goods or services

or both on behalf of another;

(6) “aggregate turnover” means the aggregate value

of all taxable supplies (excluding the value of

inward supplies on which tax is payable by a

person on reverse charge basis), exempt supplies,

exports of goods or services or both and inter-

State supplies of persons having the same

Permanent Account Number, to be computed on

all India basis but excludes central tax, State tax,

Union territory tax, integrated tax and cess;

(7) “agriculturist” means an individual or a Hindu

Undivided Family who undertakes cultivation of

land–

(a)by own labour, or

(b)by the labour of family, or

(c) by servants on wages payable in cash or kind or by

hired labour under personal supervision or the personal

supervision of any member of the family;

(8) “Appellate Authority” means an authority

appointed or authorised to hear appeals as referred

to in section 107;

(9) "Appellate Tribunal" means the Goods and

Services Tax Appellate Tribunal referred to in

section109;

(10) “appointed day” means the date on which the

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provisions of this Act shall come into force;

(11) “assessment” means determination of tax

liability under this Act and includes self-

assessment, re-assessment, provisional

assessment, summary assessment and best

judgement assessment;

43 of 1961.

(12) "associated enterprises" shall have the same

meaning as assigned to it in section 92A of the

Income-tax Act, 1961;

(13) “audit” means the examination of records,

returns and other documents maintained or

furnished by the registered person under this Act

or the rules made there under or under any other

law for the time being in force to verify the

correctness of turnover declared, taxes paid,

refund claimed and input tax credit availed, and to

assess his compliance with the provisions of this

Act or the rules made there under;

(14) “authorised bank” shall mean a bank or a

branch of a bank authorised by the Central

Government to collect the tax or any other amount

payable under this Act;

(15) “authorised representative” means the

representative as referred to under section 116;

54 of 1963.

(16) “Board” means the Central Board of Excise

and Customs constituted under the Central Boards

of Revenue Act, 1963;

(17) “business” includes––

(a) any trade, commerce, manufacture, profession,

vocation, adventure, wager or any other similar

activity, whether or not it is for a pecuniary benefit;

(b) any activity or transaction in connection with or

incidental or ancillary to sub-clause (a);

(c) any activity or transaction in the nature of sub-

clause (a), whether or not there is volume, frequency,

continuity or regularity of such transaction;

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(d) supply or acquisition of goods including capital

goods and services in connection with commencement

or closure of business;

(e) provision by a club, association, society, or any

such body (for a subscription or any other

consideration) of the facilities or benefits to its

members;

(f) admission, for a consideration, of persons to any

premises;

(g) services supplied by a person as the holder of

an office which has been accepted by him in the course

or furtherance of his trade, profession or vocation;

(h) services provided by a race club by way of

totalisator or a licence to book maker in such club; and

(i) any activity or transaction undertaken by the Central

Government, a State Government or any local authority in

which they are engaged as public authorities;

(18) “business vertical” means a distinguishable

component of an enterprise that is engaged in the

supply of individual goods or services or a group

of related goods or services which is subject to

risks and returns that are different from those of

the other business verticals.

Explanation.––For the purposes of this clause, factors

that should be considered in determining whether goods

or services are related include––

(a) the nature of the goods or services;

(b) the nature of the production processes;

(c) the type or class of customers for the goods or

services;

(d) the methods used to distribute the goods or

supply of services; and

(e) the nature of regulatory environment (wherever

applicable),including banking, insurance or public

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utilities;

(19) “capital goods” means goods, the value of

which is capitalised in the books of account of the

person claiming the input tax credit and which are

used or intended to be used in the course or

furtherance of business;

(20) “casual taxable person” means a person who

occasionally undertakes transactions involving

supply of goods or services or both in the course

or furtherance of business, whether as principal,

agent or in any other capacity, in the taxable

territory where he has no fixed place of business;

(21) “central tax” means the central goods and

services tax levied under section 9of the Central

Goods and Services Tax Act;

(22) “cess” shall have the same meaning as

assigned to it in the Goods and Services Tax

(Compensation to States) Act;

38 of 1949.

(23) “chartered accountant” means a chartered

accountant as defined in clause (b) of sub-section

(1) of section 2 of the Chartered Accountants Act,

1949;

(24) “Commissioner” means the Commissioner of

State tax appointed under section 3 and includes

the Chief Commissioner, Principal Commissioner,

special commissioner or additional

commissioner of State tax appointed under

Section 3;

(25) “Commissioner in the Board” means the

Commissioner referred to in section 168 of the

Central Goods and Services Tax Act;

(26) “common portal” means the common goods

and services tax electronic portal referred to in

section 146;

(27) “common working days” shall mean such days

in succession which are not declared as gazetted

holidays by the Central Government or the

Government of Uttar Pradesh

(28) "company secretary" means a company

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56 of 1980.

secretary as defined in clause (c) of sub-section

(1) of section 2 of the Company Secretaries Act,

1980;

(29) “competent authority” means such authority as

may be notified by the Government;

(30) “composite supply” means a supply made by a

taxable person to a recipient consisting of two or

more taxable supplies of goods or services or

both, or any combination thereof, which are

naturally bundled and supplied in conjunction

with each other in the ordinary course of business,

one of which is a principal supply;

Illustration: Where goods are packed and transported

with insurance, the supply of goods, packing materials,

transport and insurance is a composite supply and supply

of goods is a principal supply.

(31) “consideration” in relation to the supply of

goods or services or both includes––

(a) any payment made or to be made, whether in

money or otherwise, in respect of, in response to, or for

the inducement of, the supply of goods or services or

both, whether by the recipient or by any other person

but shall not include any subsidy given by the Central

Government or a State Government;

(b) the monetary value of any act or forbearance,

in respect of, in response to, or for the inducement of,

the supply of goods or services or both, whether by the

recipient or by any other person but shall not include

any subsidy given by the Central Government or a

State Government:

Provided that a deposit given in respect of the

supply of goods or services or both shall not be

considered as payment made for such supply unless the

supplier applies such deposit as consideration for the

said supply;

(32) “continuous supply of goods” means a supply

of goods which is provided, or agreed to be

provided, continuously or on recurrent basis,

under a contract, whether or not by means of a

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wire, cable, pipeline or other conduit, and for

which the supplier invoices the recipient on a

regular or periodic basis and includes supply of

such goods as the Government may, subject to

such conditions, as it may, by notification,

specify;

(33) “continuous supply of services” means a

supply of services which is provided, or agreed to

be provided, continuously or on recurrent basis,

under a contract, for a period exceeding three

months with periodic payment obligations and

includes supply of such services as the

Government may, subject to such conditions, as it

may, by notification, specify;

(34) “conveyance” includes a vessel, an aircraft and

a vehicle;

23 of 1959.

(35) “cost accountant” means a cost accountant as

defined in clause (c) of sub-section (1) of section

2 of the Cost and Works Accountants Act, 1959;

(36) “Council” means the Goods and Services Tax

Council established under article 279A of the

Constitution;

(37) “credit note” means a document issued by a

registered person under sub-section (1) of section

34;

(38) “debit note” means a document issued by a

registered person under sub-section (3) of section

34;

(39) “deemed exports” means such supplies of

goods as may be notified under section 147;

(40) “designated authority” means such authority as

may be notified by the Commissioner;

21 of 2000.

(41) “document” includes written or printed record

of any sort and electronic record as defined in

clause (t) of section 2 ofthe Information

Technology Act, 2000;

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(42) “drawback” in relation to any goods

manufactured in India and exported, means the

rebate of duty,tax or cess chargeable on any

imported inputs or on any domestic inputs or input

services used in the manufacture of such goods;

(43) “electronic cash ledger” means the electronic

cash ledger referred to in sub-section (1) of

section 49;

(44) “electronic commerce” means the supply of

goods or services or both, including digital

products over digital or electronic network;

(45) “electronic commerce operator” means any

person who owns, operates or manages digital or

electronic facility or platform for electronic

commerce;

(46) “electronic credit ledger” means the electronic

credit ledger referred to in sub-section (2) of

section 49;

(47) “exempt supply” means supply of any goods

or services or both which attracts nil rate of tax or

which may be wholly exempt from tax under

section 11, or under section 6 of the Integrated

Goods and Services Tax Act, and includes non-

taxable supply;

(48) “existing law” means any law, notification,

order, rule or regulation relating to levy and

collection of duty or tax on goods or services or

both passed or made before the commencement of

this Act by the Legislature or any Authority or

person having the power to make such law,

notification, order, rule or regulation;

(49) “family” means,—

(i) the spouse and children of the person, and

(ii) the parents, grand-parents, brothers and sisters

of the person if they are wholly or mainly

dependent on the said person;

(50) “fixed establishment” means a place (other

than the registered place of business) which is

characterised by a sufficient degree of

permanence and suitable structure in terms of

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human and technical resources to supply services,

or to receive and use services for its own needs;

(51) “Fund” means the Consumer Welfare Fund

established under section 57;

(52) “goods’’ means every kind of movable

property other than money and securities but

includes actionable claim, growing crops, grass

and things attached to or forming part of the land

which are agreed to be severed before supply or

under a contract of supply;

(53) “Government” means the Government of

Uttar Pradesh

(54) “Goods and Services Tax (Compensation to

States) Act” means the Goods and Services Tax

(Compensation to States) Act, 2017;

(55) “goods and services tax practitioner" means

any person who has been approved under section

48to act as such practitioner;

80 of 1976 (56) "India" means the territory of India as referred

to in article 1 of the Constitution, its territorial

waters, seabed and sub-soil underlying such

waters, continental shelf, exclusive economic zone

or any other maritime zone as referred to in the

Territorial Waters, Continental Shelf, Exclusive

Economic Zone and other Maritime Zones Act,

1976, and the air space above its territory and

territorial waters;

(57) “Integrated Goods and Services Tax Act”

means the Integrated Goods and Services Tax Act,

2017;

(58) “integrated tax” means the integrated goods

and services tax levied under the Integrated Goods

and Services Tax Act;

(59) “input” means any goods other than capital

goods used or intended to be used by a supplier in

the course or furtherance of business;

(60) “input service” means any service used or

intended to be used by a supplier in the course or

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furtherance of business;

(61) “Input Service Distributor” means an office of

the supplier of goods or services or both which

receives tax invoices issued under section 31

towards the receipt of input services and issues a

prescribed document for the purposes of

distributing the credit of central tax, State tax,

integrated tax or Union territory tax paid on the

said services to a supplier of taxable goods or

services or both having the same Permanent

Account Number as that of the said office;

(62) “input tax” in relation to a registered person,

means the central tax, State tax, integrated tax or

Union territory tax charged on any supply of

goods or services or both made to him and

includes–

(a) the integrated goods and services tax charged on

import of goods;

(b) the tax payable under the provisions of sub-sections

(3) and (4) of section 9;

(c) the tax payable under the provisions of sub-sections

(3) and (4) of section 5 of the Integrated Goods and

Services Tax Act; or

(d) the tax payable under the provisions of sub-

sections (3) and (4) of section 9 of the Central Goods

and Services Tax Act,

but does not include the tax paid under the composition

levy;

(63) “input tax credit” means the credit of input tax;

(64) “intra-State supply of goods” shall have the

same meaning as assigned to it in section 8 of the

Integrated Goods and Services Tax Act;

(65) “intra-State supply of services” shall have the

same meaning as assigned to it in section 8 of the

Integrated Goods and Services Tax Act;

(66) “invoice” or “tax invoice” means the tax

invoice referred to in section 31;

(67) “inward supply” in relation to a person, shall

mean receipt of goods or services or both whether

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by purchase, acquisition or any other means, with

or without consideration;

(68) “job work” means any treatment or process

undertaken by a person on goods belonging to

another registered person and the expression “job

worker” shall be construed accordingly;

(69) “local authority” means––

(a) a “Panchayat” as defined in clause (d) of

article 243 of the Constitution;

(b) a “Municipality” as defined in clause (e) of

article 243P of the Constitution;

(c) a Municipal Committee, a Zilla Parishad, a

District Board, and any other authority legally entitled

to, or entrusted by the Central Government or any

State Government with the control or management of

a municipal or local fund;

41 of 2006.

(d) a Cantonment Board as defined in section 3 of

the Cantonments Act, 2006;

(e) a Regional Council or a District Council

constituted under the Sixth Schedule to the

Constitution;

(f) a Development Board constituted under article

371 of the Constitution; or

(g) a Regional Council constituted under article

371A of the Constitution;

(70) “location of the recipient of services” means,-

(a) where a supply is received at a place of

business for which the registration has been obtained,

the location of such place of business;

(b) where a supply is received at a place other than

the place of business for which registration has been

obtained (a fixed establishment elsewhere), the

location of such fixed establishment;

(c) where a supply is received at more than one

establishment, whether the place of business or fixed

establishment, the location of the establishment most

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directly concerned with the receipt of the supply; and

(d) in absence of such places, the location of the

usual place of residence of the recipient;

(71) “location of the supplier of services” means,-

(a) where a supply is made from a place of

business for which the registration has been obtained,

the location of such place of business;

(b) where a supply is made from a place other than

the place of business for which registration has been

obtained (a fixed establishment elsewhere), the

location of such fixed establishment;

(c) where a supply is made from more than one

establishment, whether the place of business or fixed

establishment, the location of the establishment most

directly concerned with the provisions of the supply;

and

(d) in absence of such places, the location of the

usual place of residence of the supplier;

(72) “manufacture” means processing of raw

material or inputs in any manner that results in

emergence of a new product having a distinct

name, character and use and the term

“manufacturer” shall be construed accordingly;

(73) “market value” shall mean the full amount

which a recipient of a supply is required to pay in

order to obtain the goods or services or both of

like kind and quality at or about the same time and

at the same commercial level where the recipient

and the supplier are not related;

(74) “mixed supply” means two or more individual

supplies of goods or services, or any combination

thereof, made in conjunction with each other by a

taxable person for a single price where such

supply does not constitute a composite supply.

Illustration: A supply of a package consisting of canned

foods, sweets, chocolates, cakes, dry fruits, aerated drinks

and fruit juices when supplied for a single price is a mixed

supply. Each of these items can be supplied separately

and is not dependent on any other. It shall not be a mixed

supply if these items are supplied separately;

(75) “money” means the Indian legal tender or any

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foreign currency, cheque, promissory note, bill of

exchange, letter of credit, draft, pay order,

traveller cheque, money order, postal or electronic

remittance or any other instrument recognized by

the Reserve Bank of India when used as a

consideration to settle an obligation or exchange

with Indian legal tender of another denomination

but shall not include any currency that is held for

its numismatic value;

59 of 1988.

(76) “motor vehicle” shall have the same meaning

as assigned to it in clause (28) of section 2 of the

Motor Vehicles Act, 1988;

(77) “non-resident taxable person” means any

person who occasionally undertakes transactions

involving supply of goods or services or both,

whether as principal or agent or in any other

capacity, but who has no fixed place of business

or residence in India;

(78) “non-taxable supply’’ means a supply of goods

or services or both which is not leviable to tax

under this Act or under the Integrated Goods and

Services Tax Act;

(79) “non-taxable territory” means the territory

which is outside the taxable territory;

(80) “notification” means a notification published

in the Official Gazette and the expressions ‘notify’

and ‘notified’ shall be construed accordingly;

(81) “other territory” includes territories other than

those comprising in a State and those referred to

in sub-clauses (a) to (e) of clause (114);

(82) “output tax” in relation to a taxable person,

means the tax chargeable under this Act on

taxable supply of goods or services or both made

by him or by his agent but excludes tax payable

by him on reverse charge basis;

(83) “outward supply” in relation to a taxable

person, means supply of goods or services or both,

whether by sale, transfer, barter, exchange,

licence, rental, lease or disposal or any other

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mode, made or agreed to be made by such person

in the course or furtherance of business;

(84) “person” includes—

(a) an individual;

(b) a Hindu Undivided Family;

(c) a company;

(d) a firm;

(e) a Limited Liability Partnership;

(f) an association of persons or a body of

individuals, whether incorporated or not, in India or

outside India;

18 of 2013.

(g) any corporation established by or under any

Central Act, State Act or Provincial Act or a

Government company as defined in clause (45) of

section 2 of the Companies Act, 2013;

(h) any body corporate incorporated by or under

the laws of a country outside India;

(i) a co-operative society registered under any law

relating to co-operative societies;

(j) a local authority;

(k) Central Government or a State Government;

21 of 1860.

(l) society as defined under the Societies

Registration Act, 1860;

(m) trust; and

(n) every artificial juridical person, not falling

within any of the above;

(85) “place of business” includes––

(a) a place from where the business is ordinarily

carried on, and includes a warehouse, a godown or any

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other place where a taxable person stores his goods,

supplies or receives goods or services or both; or

(b) a place where a taxable person maintains his

books of account; or

(c) a place where a taxable person is engaged in

business through an agent, by whatever name called;

(86) “place of supply” means the place of supply as

referred to in Chapter V of the Integrated Goods

and Services Tax Act;

(87) “prescribed’’ means prescribed by rules made

under this Act on the recommendations of the

Council;

(88) “principal” means a person on whose behalf an

agent carries on the business of supply or receipt

of goods or services or both;

(89) “principal place of business” means the place

of business specified as the principal place of

business in the certificate of registration;

(90) “principal supply” means the supply of goods

or services which constitutes the predominant

element of a composite supply and to which any

other supply forming part of that composite

supply is ancillary;

(91) “proper officer” in relation to any function to

be performed under this Act, means the

Commissioner or the officer of the State tax who

is assigned that function by the Commissioner;

(92) “quarter” shall mean a period comprising three

consecutive calendar months, ending on the last

day of March, June, September and December of

a calendar year;

(93) “recipient” of supply of goods or services or

both, means—

(a) where a consideration is payable for the supply

of goods or services or both, the person who is liable to

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pay that consideration;

(b) where no consideration is payable for the

supply of goods, the person to whom the goods are

delivered or made available, or to whom possession or

use of the goods is given or made available; and

(c) where no consideration is payable for the

supply of a service, the person to whom the service is

rendered,

and any reference to a person to whom a supply is made

shall be construed as a reference to the recipient of the

supply and shall include an agent acting as such on behalf

of the recipient in relation to the goods or services or both

supplied;

(94) “registered person” means a person who is

registered under section 25but does not include a

person having a Unique Identity Number.

(95) “regulations” means the regulations made by

the Government under this Act on the

recommendations of the Council;

(96) “removal’’ in relation to goods, means-

(a) despatch of the goods for delivery by the

supplier thereof or by any other person acting on

behalf of such supplier; or

(b) collection of the goods by the recipient thereof

or by any other person acting on behalf of such

recipient;

(97) “return” means any return prescribed or

otherwise required to be furnished by or under this

Act or the rules made there under;

(98) “reverse charge’’ means the liability to pay tax

by the recipient of supply of goods or services or

both instead of the supplier of such goods or

services or both under sub-section (3) or sub-

section (4) of section 9,or under sub-section (3) or

sub-section (4) of section 5 of the Integrated

Goods and Services Tax Act;

17

(99) “Revisional Authority” meansan authority

appointed or authorised for revision of decision or

orders as referred to in section 108;

(100) “Schedule” means a Schedule appended to this

Act;

42 of 1956.

(101) “securities” shall have the same meaning as

assigned to it in clause (h) of section 2 of the

Securities Contracts (Regulation) Act, 1956;

(102) “services” means anything other than goods,

money and securities but includes activities

relating to the use of money or its conversion by

cash or by any other mode, from one form,

currency or denomination, to another form,

currency or denomination for which a separate

consideration is charged;

(103) “State” means the State of Uttar Pradesh

(104) “State tax” means the tax levied under this

Act;

(105) “supplier” in relation to any goods or services

or both, shall mean the person supplying the said

goods or services or both and shall include an

agent acting as such on behalf of such supplier in

relation to the goods or services or both supplied;

(106) “tax period’’ means the period for which the

return is required to be furnished;

(107) “Taxable person” means a person who is

registered or liable to be registered under section

22 or section 24;

(108) “Taxable supply’’ means a supply of goods or

services or both which is leviable to tax under this

Act;

(109) “taxable territory’’ means the territory to

which the provisions of this Act apply;

(110) “telecommunication service” means service of

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any description (including electronic mail, voice

mail, data services, audio text services, video text

services, radio paging and cellular mobile

telephone services) which is made available to

users by means of any transmission or reception

of signs, signals, writing, images and sounds or

intelligence of any nature, by wire, radio, visual or

other electromagnetic means;

(111) “the Central Goods and Services Tax Act”

means the Central Goods and Services Tax Act,

2017;

(112) “turnover in State” or “turnover in Union

territory” means the aggregate value of all taxable

supplies (excluding the value of inward supplies

on which tax is payable by a person on reverse

charge basis) and exempt supplies made within a

State or Union territory by a taxable person,

exports of goods or services or both and inter-

State supplies of goods or services or both made

from the State or Union territory by the said

taxable person but excludes central tax, State tax,

Union territory tax, integrated tax and cess;

(113) “usual place of residence” means––

(a) in case of an individual, the place where he

ordinarily resides;

(b) in other cases, the place where the person is

incorporated or otherwise legally constituted;

(114) “Union territory” means the territory of,-

(a) the Andaman and Nicobar Islands;

(b) Lakshadweep;

(c) Dadra and Nagar Haveli;

(d) Daman and Diu;

(e) Chandigarh; and

(f) other territory;

Explanation.- For the purposes of this Act, each of

the territories specified in sub-clauses (a) to (f)

shall be considered to be a separate Union

territory.

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(115) “Union territory tax” means the Union

territory goods and services tax levied under the

Union Territory Goods and Services Tax Act;

(116) “Union Territory Goods and Services Tax

Act” means the Union Territory Goods and

Services Tax Act, 2017;

(117) “valid return” means a return furnished under

sub-section (1) of section 39 on which self-

assessed tax has been paid in full;

(118) “voucher” means an instrument where there is

an obligation to accept it as consideration or part

consideration for a supply of goods or services or

both and where the goods or services or both to be

supplied or the identities of their potential

suppliers are either indicated on the instrument

itself or in related documentation, including the

terms and conditions of use of such instrument;

(119) “works contract” means a contract for

building, construction, fabrication, completion,

erection, installation, fitting out, improvement,

modification, repair, maintenance, renovation,

alteration or commissioning of any immovable

property wherein transfer of property in goods

(whether as goods or in some other form) is

involved in the execution of such contract;

(120) words and expressions used and not defined in

this Act but defined in the Integrated Goods and

Services Tax Act, the Central Goods and Services

Tax Act, the Union Territory Goods and Services

Tax Act and the Goods and Services Tax

(Compensation to States) Act shall have the same

meanings as assigned to them in those Acts.

CHAPTER II

ADMINISTRATION

3. The Government shall, by notification, appoint the

following classes of officers for the purposes of this

Act, namely:––

Officers under this

Act.

(a) Principal Commissioner, Chief Commissioner

or Commissioner of State tax

20

(b) Special Commissioners of State tax

(c) Additional Commissioners of State tax,

(d) Joint Commissioners of State tax,

(e) Deputy Commissioners of State tax,

(f) Assistant Commissioners of State tax,

(g) State tax officeres and

(h) any other class of officers as it may deem fit:

-- of -- Provided that, the officers appointed under the Uttar

Pradesh Value Added Tax Act, 2008 shall be deemed to

be the officers appointed under the provisions of this

Act.

4. (1) The Government may, in addition to the officers

as may be notified under section 3,appoint such

persons as it may think fit to be the officers under

this Act.

Appointment of

officers.

(2) The Commissioner shall have jurisdiction over the

whole of the State, the Special Commissioner and

an Additional Commissioner in respect of all or

any of the functions assigned to them, shall have

jurisdiction over the whole of the State or where

the State Government so directs, over any local

area thereof, and all other officers shall, subject to

such conditions as may be specified, have

jurisdiction over the whole of the State or over

such local areas as the Commissioner may, by

order, specify.

5. (1) Subject to such conditions and limitations as the

Commissioner may impose, an officer of State tax

may exercise the powers and discharge the duties

conferred or imposed on him under this Act.

Powers of officers.

(2) An officer of State tax may exercise the powers

and discharge the duties conferred or imposed

under this Act on any other officer of State tax

who is subordinate to him.

(3) The Commissioner may, subject to such

conditions and limitations as may be specified in

this behalf by him, delegate his powers to any

21

other officer who is subordinate to him.

(4) Notwithstanding anything contained in this

section, an Appellate Authority shall not exercise

the powers and discharge the duties conferred or

imposed on any other officer of State tax.

6. (1) Without prejudice to the provisions of this Act,

the officers appointed under the Central Goods and

Services Tax Act are authorised to be the proper

officers for the purposes of this Act, subject to such

conditions as the Government shall, on the

recommendations of the Council, by notification,

specify.

Authorisation of

officers of central

tax as proper officer

in certain

circumstances.

(2) Subject to the conditions specified in the

notification issued under sub-section (1),-

(a) where any proper officer issues an order under

this Act, he shall also issue an order under the

Central Goods and Services Tax Act, as

authorised by the said Act under intimation to

the jurisdictional officer of central tax;

(b) where a proper officer under the Central

Goods and Services Tax Act has initiated any

proceedings on a subject matter, no proceedings

shall be initiated by the proper officer under this

Act on the same subject matter.

(3) Any proceedings for rectification, appeal and

revision, wherever applicable, of any order passed

by an officer appointed under this Act, shall not

lie before an officer appointed under the Central

Goods and Services Tax Act.

CHAPTER III

LEVY AND COLLECTION OF TAX

7. (1) For the purposes of this Act, the expression

“supply” includes––

Scope of supply.

(a) all forms of supply of goods or services or both

such as sale, transfer, barter, exchange, license, rental,

lease or disposal made or agreed to be made for a

consideration by a person in the course or furtherance of

business;

(b) import of services for a consideration whether or not

in the course or furtherance of business;

22

(c) the activities specified in Schedule I, made or

agreed to be made without a consideration; and

(d) the activities to be treated as supply of goods or

supply of services as referred to in Schedule II.

(2) Notwithstanding anything contained in sub-section

(1),––

(a) activities or transactions specified in Schedule III;

or

(b) such activities or transactions undertaken by the

Central Government, a State Government or any local

authority in which they are engaged as public authorities,

as may be notified by the Government on the

recommendations of the Council,

shall be treated neither as a supply of goods nor a

supply of services.

(3) Subject to the provisions of sub-sections (1) and (2),

the Government may, on the recommendations of the

Council, specify, by notification, the transactions that

are to be treated as—

(a) a supply of goods and not as a supply of services;

or

(b) a supply of services and not as a supply of goods.

8. The tax liability on a composite or a mixed supply

shall be determined in the following manner, namely:

—

Tax liability on

composite and mixed

supplies.

(a) a composite supply comprising two or more

supplies, one of which is a principal supply, shall be

treated as a supply of such principal supply; and

(b) a mixed supply comprising two or more supplies

shall be treated as a supply of that particular supply which

attracts the highest rate of tax.

9. (1) Subject to the provisions of sub-section (2), there

shall be levied a tax called the Uttar Pradesh goods

and services tax on all intra-State supplies of goods or

services or both, except on the supply of alcoholic

Levy and collection.

23

liquor for human consumption, on the value

determined under section 15 and at such rates, not

exceeding twenty per cent., as may be notified by the

Government on the recommendations of the Council

and collected in such manner as may be prescribed

and shall be paid by the taxable person.

(2) The State tax on the supply of petroleum crude,

high speed diesel, motor spirit (commonly known

as petrol), natural gas and aviation turbine fuel,

shall be levied with effect from such date as may

be notified by the Government on the

recommendations of the Council.

(3) The Government may, on the recommendations of

the Council, by notification, specify categories of

supply of goods or services or both, the tax on

which shall be paid on reverse charge basis by the

recipient of such goods or services or both and all

the provisions of this Act shall apply to such

recipient as if he is the person liable for paying the

tax in relation to the supply of such goods or

services or both.

(4) The State tax in respect of the supply of taxable

goods or services or both by a supplier, who is not

registered, to a registered person shall be paid by

such person on reverse charge basis as the

recipient and all the provisions of this Act shall

apply to such recipient as if he is the person liable

for paying the tax in relation to the supply of such

goods or services or both.

(5) The Government may, on the recommendations of

the Council, by notification, specify categories of

services the tax on intra-State supplies of which

shall be paid by the electronic commerce operator

if such services are supplied through it, and all the

provisions of this Act shall apply to such

electronic commerce operator as if he is the

supplier liable for paying the tax in relation to the

supply of such services:

Provided that where an electronic commerce operator

does not have a physical presence in the taxable territory,

any person representing such electronic commerce

24

operator for any purpose in the taxable territory shall be

liable to pay tax:

Provided further that where an electronic commerce

operator does not have a physical presence in the taxable

territory and also he does not have a representative in the

said territory, such electronic commerce operator shall

appoint a person in the taxable territory for the purpose of

paying tax and such person shall be liable to pay tax.

10. (1) Notwithstanding anything to the contrary

contained in this Act but subject to the provisions of

sub-sections (3) and (4) of section 9, a registered

person, whose aggregate turnover in the preceding

financial year did not exceed fifty lakh rupees may opt

to pay, in lieu of the tax payable by him, an amount

calculated at such rate as may be prescribed, but not

exceeding,-

Composition levy.

(a) One per cent. of the turnover in State in case

of a manufacturer,

(b) Two and a half per cent. of the turnover in

State in case of persons engaged in making

supplies referred to in clause (b) of

paragraph 6 of Schedule II, and

(c) half per cent. of the turnover in State in case

of other suppliers,

subject to such conditions and restrictions as may be

prescribed:

Provided that the Government may, by notification,

increase the said limit of fifty lakh rupees to such

higher amount, not exceeding one crore rupees, as

may be recommended by the Council.

(2) The registered person shall be eligible to opt

under sub-section (1), if—

(a) he is not engaged in the supply of services other

than supplies referred to in clause (b) of paragraph 6 of

Schedule II;

(b) he is not engaged in making any supply of

goods which are not leviable to tax under this Act;

(c) he is not engaged in making any inter-State

outward supplies of goods;

25

(d) he is not engaged in making any supply of

goods through an electronic commerce operator who is

required to collect tax at source under section 52; and

(e) he is not a manufacturer of such goods as may

be notified by the Government on the

recommendations of the Council:

43 of 1961

Provided that where more than one registered

person are having the same Permanent Account

Number (issued under the Income-tax Act 1961), the

registered person shall not be eligible to opt for the

scheme under sub-section (1) unless all such registered

persons opt to pay tax under that sub-section.

(3) The option availed of by a registered person under

sub-section (1) shall lapse with effect from the

day on which his aggregate turnover during a

financial year exceeds the limit specified under

sub-section(1).

(4) A taxable person to whom the provisions of sub-

section (1) apply shall not collect any tax from the

recipient on supplies made by him nor shall he be

entitled to any credit of input tax.

(5) If the proper officer has reasons to believe that a

taxable person has paid tax under sub-section (1)

despite not being eligible, such person shall, in

addition to any tax that may be payable by him

under any other provisions of this Act, be liable to

a penalty and the provisions of section 73 or

section 74 shall, mutatis mutandis, apply for

determination of tax and penalty.

11. (1) Where the Government is satisfied that it is

necessary in the public interest so to do, it may, on the

recommendations of the Council, by notification,

exempt generally, either absolutely or subject to such

conditions as may be specified therein, goods or

services or both of any specified description from the

whole or any part of the tax leviable thereon with

effect from such date as may be specified in such

notification.

Power to grant

exemption from tax.

(2) Where the Government is satisfied that it is

26

necessary in the public interest so to do, it may, on

the recommendations of the Council, by special

order in each case, under circumstances of an

exceptional nature to be stated in such order,

exempt from payment of tax any goods or services

or both on which tax is leviable.

(3) The Government may, if it considers necessary or

expedient so to do for the purpose of clarifying the

scope or applicability of any notification issued

under sub-section (1) or order issued under sub-

section (2), insert an explanation in such

notification or order, as the case may be, by

notification at any time within one year of issue of

the notification under sub-section (1) or order

under sub-section (2), and every such explanation

shall have effect as if it had always been the part

of the first such notification or order, as the case

may be.

(4) Any notification issued by the Central

Government, on the recommendations of the

Council, under sub-section (1) of section 11 or

order issued under sub-section (2) of the said

section of the Central Goods and Services Tax

Act shall be deemed to be a notification or, as the

case may be, an order issued under this Act.

Explanation.––For the purposes of this section, where an

exemption in respect of any goods or services or both

from the whole or part of the tax leviable thereon has been

granted absolutely, the registered person supplying such

goods or services or both shall not collect the tax, in

excess of the effective rate, on such supply of goods or

services or both.

CHAPTER IV

TIME AND VALUE OF SUPPLY

12. (1) The liability to pay tax on goods shall arise at the

time of supply, as determined in accordance with the

provisions of this section.

Time of supply of

goods.

27

(2) The time of supply of goods shall be the earlier of

the following dates, namely:-

(a) the date of issue of invoice by the supplier or

the last date on which he is required, under sub-section

(1) of section 31, to issue the invoice with respect to

the supply; or

(b) the date on which the supplier receives the

payment with respect to the supply:

Provided that where the supplier of taxable goods

receives an amount up to one thousand rupees in

excess of the amount indicated in the tax invoice, the

time of supply to the extent of such excess amount

shall, at the option of the said supplier, be the date of

issue of invoice in respect of such excess amount.

Explanation 1.––For the purposes of clauses (a) and

(b), “supply” shall be deemed to have been made to the

extent it is covered by the invoice or, as the case may

be,the payment.

Explanation 2.––For the purposes of clause (b), “the

date on which the supplier receives the payment” shall be

the date on which the payment is entered in his books of

account or the date on which the payment is credited to

his bank account, whichever is earlier.

(3) In case of supplies in respect of which tax is paid

or liable to be paid on reverse charge basis, the

time of supply shall be the earliest of the

following dates, namely:—

(a) the date of the receipt of goods; or

(b) the date of payment as entered in the books of

account of the recipient or the date on which the

payment is debited in his bank account, whichever is

earlier; or

(c) the date immediately following thirty days from

the date of issue of invoice or any other document, by

whatever name called, in lieu thereofby the supplier:

Provided that where it is not possible to determine

28

the time of supply under clause (a) or clause (b) or

clause (c), the time of supply shall be the date of entry

in the books of account of the recipient of supply.

(4) In case of supply of vouchers by a supplier, the

time of supply shall be-

(a) the date of issue of voucher, if the supply is

identifiable at that point; or

(b) the date of redemption of voucher, in all other

cases.

(5) Where it is not possible to determine the time of

supply under the provisions of sub-section (2) or

sub-section (3) or sub-section (4), the time of

supply shall––

(a) in a case where a periodical return has to be

filed, be the date on which such return is to be filed; or

(b) in any other case, be the date on which the tax

is paid.

(6) The time of supply to the extent it relates to an

addition in the value of supply by way of interest,

late fee or penalty for delayed payment of any

consideration shall be the date on which the

supplier receives such addition in value.

13. (1) The liability to pay tax on services shall arise at

the time of supply, as determined in accordance with

the provisions of this section.

Time of supply of

services.

(2) The time of supply of services shall be the earliest

of the following dates, namely:–

(a) the date of issue of invoice by the supplier, if the

invoice is issued within the period prescribed under

sub-section (2) of section 31 or the date of receipt of

payment, whichever is earlier; or

(b) the date of provision of service, if the invoice is

not issued within the period prescribed under sub-

section (2) of section 31 or the date of receipt of

payment, whichever is earlier; or

(c) the date on which the recipient shows the receipt of

services in his books of account, in a case where the

29

provisions of clause (a) or clause (b) do not apply:

Provided that where the supplier of taxable service

receives an amount upto one thousand rupees in excess

of the amount indicated in the tax invoice, the time of

supply to the extent of such excess amount shall, at the

option of the said supplier, be the date of issue of

invoice relating to such excess amount.

Explanation.––For the purposes of clauses (a) and (b)-

(i) the supply

shall be deemed to have been made to the

extent it is covered by the invoice or, as the

case may be, the payment;

(ii) “the date of

receipt of payment” shall be the date on which

the payment is entered in the books of account

of the supplier or the date on which the

payment is credited to his bank account,

whichever is earlier.

(3) In case of supplies in respect of which tax is paid

or liable to be paid on reverse charge basis, the

time of supply shall be the earlier of the following

dates, namely:––

(a) the date of payment as entered in the books of

account of the recipient or the date on which the

payment is debited in his bank account, whichever is

earlier; or

(b) the date immediately following sixty days from

the date of issue of invoice or any other document, by

whatever name called, in lieu thereof by the supplier:

Provided that where it is not possible to determine the

time of supply under clause (a) or clause (b), the time of

supply shall be the date of entry in the books of account

of the recipient of supply:

Provided further that in case of supply by associated

enterprises, where the supplier of service is located

outside India, the time of supply shall be the date of entry

in the books of account of the recipient of supply or the

date of payment, whichever is earlier.

30

(4) In case of supply of vouchers by a supplier, the

time of supply shall be––

(a) the date of issue of voucher, if the supply is

identifiable at that point; or

(b) the date of redemption of voucher, in all other

cases.

(5) Where it is not possible to determine the time of

supply under the provisions of sub-section (2) or

sub-section (3) or sub-section (4), the time of

supply shall––

(a) in a case where a periodical return has to be

filed, be the date on which such return is to be filed; or

(b) in any other case, be the date on which the tax

is paid.

(6) The time of supply to the extent it relates to an

addition in the value of supply by way of interest,

late fee or penalty for delayed payment of any

consideration shall be the date on which the

supplier receives such addition in value.

14. Notwithstanding anything contained in section 12 or

section 13, the time of supply, where there is a change

in the rate of tax in respect of goods or services or

both, shall be determined in the following manner,

namely:––

Change in rate of tax

in respect of supply

of goods or services.

(a) in case the goods or services or both have been

supplied before the change in rate of tax,––

(i) where the invoice for the same has been

issued and the payment is also received after the

change in rate of tax, the time of supply shall be the

date of receipt of payment or the date of issue of

invoice, whichever is earlier; or

(ii) where the invoice has been issued prior to

thechange in rate of tax but payment is received

after the change in rate of tax, the time of supply

shall be the date of issue of invoice; or

(iii) where the payment has been received

31

before the change in rate of tax, but the invoice for

the same is issued after the change in rate of tax,

the time of supply shall be the date of receipt of

payment;

(b) in case the goods or services or both have been

supplied after the change in rate of tax,––

(i) where the payment is received after the

change in rate of tax but the invoice has been

issued prior to the change in rate of tax, the time of

supply shall be the date of receipt of payment; or

(ii) where the invoice has been issued and

payment is received before the change in rate of

tax, the time of supply shall be the date of receipt

of payment or date of issue of invoice, whichever is

earlier; or

(iii) where the invoice has been issued after the

change in rate of tax but the payment is received

before the change in rate of tax, the time of supply

shall be the date of issue of invoice:

Provided that the date of receipt of payment shall be

the date of credit in the bank account if such credit in the

bank account is after four working days from the date of

change in the rate of tax.

Explanation.––For the purposes of this section, “the

date of receipt of payment” shall be the date on which the

payment is entered in the books of account of the supplier

or the date on which the payment is credited to his bank

account, whichever is earlier.

15. (1) The value of a supply of goods or services or both

shall be the transaction value, which is the price

actually paid or payable for the said supply of goods

or services or both where the supplier and the

recipient of the supply are not related and the price is

the sole consideration for the supply.

Value of taxable

supply.

(2) The value of supply shall include–––

(a) any taxes, duties, cesses, fees and charges levied

under any law for the time being in force other than this

32

Act, the Central Goods and Services Tax Act and the

Goods and Services Tax (Compensation to States) Act, if

charged separately by the supplier;

(b) any amount that the supplier is liable to pay in

relation to such supply but which has been incurred by

the recipient of the supply and not included in the price

actually paid or payable for the goods or services or

both;

(c) incidental expenses, including commission and

packing, charged by the supplier to the recipient of a

supply and any amount charged for anything done by the

supplier in respect of the supply of goods or services or

both at the time of, or before delivery of goods or supply

of services;

(d) interest or late fee or penalty for delayed

payment of any consideration for any supply; and

(e) subsidies directly linked to the price excluding

subsidies provided by the Central Government and

State Governments.

Explanation.––For the purposes of this sub-section,

the amount of subsidy shall be included in the value of

supply of the supplier who receives the subsidy.

(3) The value of the supply shall not include any

discount which is given—

(a) before or at the time of the supply if such

discount has been duly recorded in the invoice issued

in respect of such supply; and

(b) after the supply has been effected, if-

(i) such discount is established in terms of an

agreement entered into at or before the time of such

supply and specifically linked to relevant invoices;

and

(ii) input tax credit as is attributable to the

discount on the basis of document issued by the

supplier has been reversed by the recipient of the

supply.

33

(4) Where the value of the supply of goods or services

or both cannot be determined under sub-section

(1), the same shall be determined in such manner

as may be prescribed.

(5) Notwithstanding anything contained in sub-

section (1) or sub-section (4), the value of such

supplies as may be notified by the Government on

the recommendations of the Council shall be

determined in such manner as may be prescribed.

Explanation.- For the purposes of this Act,-

(a) persons shall be deemed to be “related persons’’ if -

(i) such persons

are officers or directors of one another's

businesses;

(ii) such persons

are legally recognised partners in business;

(iii) such persons

are employer and employee;

(iv) any person

directly or indirectly owns, controls or

holds twenty-five per cent. or more of the

outstanding voting stock or shares of both

of them;

(v) one of them

directly or indirectly controls the other;

(vi) both of them

are directly or indirectly controlled by a

third person;

(vii) together they

directly or indirectly control a third person;

or

(viii) they are members of the same

family;

(b) the term "person" also includes legal persons.

(c) persons who are associated in the business of one

another in that one is the sole agent or sole distributor or

sole concessionaire, howsoever described, of the other,

34

shall be deemed to be related.

CHAPTER V

INPUT TAX CREDIT

. 16. (1) Every registered person shall, subject to such

conditions and restrictions as may be prescribed and

in the manner specified in section 49, be entitled to

take credit of input tax charged on any supply of

goods or services or both to him which are used or

intended to be used in the course or furtherance of his

business and the said amount shall be credited to the

electronic credit ledger of such person.

Eligibility and

conditions for taking

input tax credit.

(2) Notwithstanding anything contained in this

section, no registered person shall be entitled to

the credit of any input tax in respect of any supply

of goods or services or both to him unless,––

(a) he is in possession of a tax invoice or debit note

issued by a supplier registered under this Act, or such

other tax paying documents as may be prescribed;

(b) he has received the goods or services or both.

Explanation.—For the purposes of this clause, it

shall be deemed that the registered person has received

the goods where the goods are delivered by the

supplier to a recipient or any other person on the

direction of such registered person, whether acting as

an agent or otherwise, before or during movement of

goods, either by way of transfer of documents of title

to goods or otherwise;

(c) subject to the provisions of section 41, the tax

charged in respect of such supply has been actually

paid to the Government, either in cash or through

utilisation of input tax credit admissible in respect of

the said supply; and

(d) he has furnished the return under section 39:

Provided that where the goods against an invoice

are received in lots or instalments, the registered

35

person shall be entitled to take credit upon receipt of

the last lot or instalment:

Provided further that where a recipient fails to pay

to the supplier of goods or services or both, other than

the supplies on which tax is payable on reverse charge

basis, the amount towards the value of supply along

with tax payable thereon within a period of one

hundred and eighty days from the date of issue of

invoice by the supplier, an amount equal to the input

tax credit availed by the recipient shall be added to his

output tax liability, along with interest thereon, in such

manner as may be prescribed:

Provided also that the recipient shall be entitled to

avail of the credit of input tax on payment made by

him of the amount towards the value of supply of

goods or services or both along with tax payable

thereon.

43 of 1961.

(3) Where the registered person has claimed

depreciation on the tax component of the cost of

capital goods and plant and machinery under the

provisions of the Income-tax Act, 1961, the input

tax credit on the said tax component shall not be

allowed.

(4) A registered person shall not be entitled to take

input tax credit in respect of any invoice or debit

note for supply of goods or services or both after

the due date of furnishing of the return under

section 39 for the month of September following

the end of financial year to which such invoice or

invoice relating to such debit note pertains or

furnishing of the relevant annual return,

whichever is earlier.

17. (1) Where the goods or services or both are used by

the registered person partly for the purpose of any

business and partly for other purposes, the amount of

credit shall be restricted to so much of the input tax as

is attributable to the purposes of his business.

Apportionment of

credit and blocked

credits.

(2) Where the goods or services or both are used by

the registered person partly for effecting taxable

supplies including zero-rated supplies under this

Act or under the Integrated Goods and Services

36

Tax Act and partly for effecting exempt supplies

under the said Acts, the amount of credit shall be

restricted to so much of the input tax as is

attributable to the said taxable supplies including

zero-rated supplies.

(3) The value of exempt supply under sub-section (2)

shall be such as may be prescribed, and shall

include supplies on which the recipient is liable to

pay tax on reverse charge basis, transactions in

securities, sale of land and, subject to clause (b) of

paragraph 5 of Schedule II, sale of building.

(4) A banking company or a financial institution

including a non-banking financial company,

engaged in supplying services by way of

accepting deposits, extending loans or advances

shall have the option to either comply with the

provisions of sub-section (2), or avail of, every

month, an amount equal to fifty per cent. of the

eligible input tax credit on inputs, capital goods

and input services in that month and the rest shall

lapse:

Provided that the option once exercised shall not be

withdrawn during the remaining part of the financial year:

Provided further that the restriction of fifty percent.

shall not apply to the tax paid on supplies made by one

registered person to another registered person having the

same Permanent Account Number.

(5) Notwithstanding anything contained in sub-

section (1) of section 16 and sub-section (1) of

section 18, input tax credit shall not be available

in respect of the following, namely:-

(a) motor vehicles and other conveyances except

when they are used––

(i) for making the following taxable supplies,

namely:––

(A) further supply of such vehicles or

conveyances; or

37

(B) transportation of passengers; or

(C) imparting training on driving, flying,

navigating such vehicles or conveyances;

(ii) for transportation of goods;

(b) the following supply of goods or services or

both:-

(i) food and beverages, outdoor catering,

beauty treatment, health services, cosmetic and

plastic surgery except where an inward supply of

goods or services or both of a particular category is

used by a registered person for making an outward

taxable supply of the same category of goods or

services or both or as an element of a taxable

composite or mixed supply;

(ii) membership of a club, health and fitness

centre;

(iii) rent-a-cab, life insurance and health

insurance except where -

(A) the Government notifies the services which are

obligatory for an employer to provide to its

employees under any law for the time being in

force; or

(B) such inward supply of goods or services or

both of a particular category is used by a registered

person for making an outward taxable supply of

the same category of goods or services or both or

as part of a taxable composite or mixed supply;

and

(iv) travel benefits extended to employees on

vacation such as leave or home travel concession.

(c) works contract services when supplied for

construction of an immovable property (other than

plant and machinery) except where it is an input

service for further supply of works contract service;

(d) goods or services or both received by a taxable

person for construction of an immovable property

(other than plant or machinery) on his own account

38

including when such goods or services or both are used

in the course or furtherance of business.

Explanation.––For the purposes of clauses (c) and

(d), the expression “construction” includes re-

construction, renovation, additions or alterations or

repairs, to the extent of capitalisation, to the said

immovable property;

(e) goods or services or both on which tax has been

paid under section10;

(f) goods or services or both received by a non-

resident taxable person except on goods imported by

him;

(g) goods or services or both used for personal

consumption;

(h) goods lost, stolen, destroyed, written off or

disposed of by way of gift or free samples; and

(i) any tax paid in accordance with the provisions

of sections 74, 129 and 130.

(6) The Government may prescribe the manner in

which the credit referred to in sub-sections (1) and

(2) may be attributed.

Explanation.–– For the purposes of this Chapter and

Chapter VI, the expression “plant and machinery” means

apparatus, equipment, and machinery fixed to earth by

foundation or structural support that are used for making

outward supply of goods or services or both and includes

such foundation and structural supports but excludes-

(i) land, building or any other civil structures;

(ii) telecommunication towers; and

(iii) pipelines laid outside the factory premises.

18. (1) Subject to such conditions and restrictions as may

be prescribed–

Availability of credit

in special

circumstances.

(a) a person who has applied for registration under

this Act within thirty days from the date on which he

becomes liable to registration and has been granted

such registration shall be entitled to take credit of input

39

tax in respect of inputs held in stock and inputs

contained in semi-finished or finished goods held in

stock on the day immediately preceding the date from

which he becomes liable to pay tax under the

provisions of this Act;

(b) a person who takes registration under sub-

section (3) of section 25 shall be entitled to take credit

of input tax in respect of inputs held in stock and

inputs contained in semi-finished or finished goods

held in stock on the day immediately preceding the

date of grant of registration;

(c) where any registered person ceases to pay tax

under section 10, he shall be entitled to take credit of

input tax in respect of inputs held in stock, inputs

contained in semi-finished or finished goods held in

stock and on capital goods on the day immediately

preceding the date from which he becomes liable to

pay tax under section 9:

Provided that the credit on capital goods shall be

reduced by such percentage points as may be

prescribed;

(d) where an exempt supply of goods or services or

both by a registered person becomes a taxable supply,

such person shall be entitled to take credit of input tax

in respect of inputs held in stock and inputs contained

in semi-finished or finished goods held in stock

relatable to such exempt supply and on capital goods

exclusively used for such exempt supply on the day

immediately preceding the date from which such

supply becomes taxable:

Provided that the credit on capital goods shall be

reduced by such percentage points as may be

prescribed.

(2) A registered person shall not be entitled to take

input tax credit under sub-section (1) in respect of

any supply of goods or services or both to him

after the expiry of one year from the date of issue

of tax invoice relating to such supply.

(3) Where there is a change in the constitution of a

40

registered person on account of sale, merger,

demerger, amalgamation, lease or transfer of the

business with the specific provisions for transfer

of liabilities, the said registered person shall be

allowed to transfer the input tax credit which

remains unutilised in his electronic credit ledger to

such sold, merged, demerged, amalgamated,

leased or transferred business in such manner as

may be prescribed.

(4) Where any registered person who has availed of

input tax credit opts to pay tax under section 10

or, where the goods or services or both supplied

by him become wholly exempt, he shall pay an

amount, by way of debit in the electronic credit

edger or electronic cash ledger, equivalent to the

credit of input tax in respect of inputs held in

stock and inputs contained in semi-finished or

finished goods held in stock and on capital goods,

reduced by such percentage points as may be

prescribed, on the day immediately preceding the

date of exercising of such option or, as the case

may be, the date of such exemption:

Provided that after payment of such amount, the

balance of input tax credit, if any, lying in his electronic

credit ledger shall lapse.

(5) The amount of credit under sub-section (1) and

the amount payable under sub-section (4) shall be

calculated in such manner as may be prescribed.

(6) In case of supply of capital goods or plant and

machinery, on which input tax credit has been

taken, the registered person shall pay an amount

equal to the input tax credit taken on the said

capital goods or plant and machinery reduced by

such percentage points as may be prescribed or

the tax on the transaction value of such capital

goods or plant and machinery determined under

section15, whichever is higher:

Provided that where refractory bricks, moulds and dies,

jigs and fixtures are supplied as scrap, the taxable person

may pay tax on the transaction value of such goods

determined under section15.

41

19. (1) The principal shall, subject to such conditions and

restrictions as may be prescribed, be allowed input tax

credit on inputs sent to a job worker for job work.

Taking input tax

credit in respect of

inputs and capital

goods sent for job

work.

(2) Notwithstanding anything contained in clause (b)

of sub-section (2) of section 16, the principal shall

be entitled to take credit of input tax on inputs

even if the inputs are directly sent to a job worker

for job work without being first brought to his

place of business.

(3) Where the inputs sent for job work are not

received back by the principal after completion of

job work or otherwise or are not supplied from the

place of business of the job worker in accordance

with clause (a) or clause (b)of sub-section (1) of

section 143 within one year of being sent out, it

shall be deemed that such inputs had been

supplied by the principal to the job worker on the

day when the said inputs were sent out:

Provided that where the inputs are sent directly to a

job worker, the period of one year shall be counted from

the date of receipt of inputs by the job worker.

(4) The principal shall, subject to such conditions and

restrictions as may be prescribed, be allowed input

tax credit on capital goods sent to a job worker for

job work.

(5) Notwithstanding anything contained in clause (b)

of sub-section (2) of section 16, the principal shall

be entitled to take credit of input tax on capital

goods even if the capital goods are directly sent to

a job worker for job work without being first

brought to his place of business.

(6) Where the capital goods sent for job work are not

received back by the principal within a period of

three years of being sent out, it shall be deemed

that such capital goods had been supplied by the

principal to the job worker on the day when the

said capital goods were sent out:

42

Provided that where the capital goods are sent directly

to a job worker, the period of three years shall be counted

from the date of receipt of capital goods by the job

worker.

(7) Nothing contained in sub-section (3) or sub-

section (6) shall apply to moulds and dies, jigs and

fixtures, or tools sent out to a job worker for job

work.

Explanation.- For the purpose of this section,

“principal” means the person referred to in section

143.

20. (1) The Input Service Distributor shall distribute the

credit of State tax as State tax or integrated tax and

integrated tax as integrated tax or State tax, by way of

issue of document containing the amount of input tax

credit being distributed in such manner as may be

prescribed.

Manner of

distribution of credit

by Input Service

Distributor.

(2) The Input Service Distributor may distribute the

credit subject to the following conditions,

namely:––

(a) the credit can be distributed to the recipients of

credit against document containing such details as

may be prescribed;

(b) the amount of the credit distributed shall not

exceed the amount of credit available for distribution;

(c) the credit of tax paid on input services

attributable to a recipient of credit shall be distributed

only to that recipient;

(d) the credit of tax paid on input services

attributable to more than one recipient of credit shall

be distributed amongst such recipients to whom the

input service is attributable and such distribution shall

be pro rata on the basis of the turnover in a State or

turnover in a Union territory of such recipient, during

the relevant period, to the aggregate of the turnover of

all such recipients to whom such input service is

attributable and which are operational in the current

year, during the said relevant period;

43

(e) the credit of tax paid on input services

attributable to all recipients of credit shall be

distributed amongst such recipients and such

distribution shall be pro rata on the basis of the

turnover in a State or turnover in a Union territory of

such recipient, during the relevant period, to the

aggregate of the turnover of all recipients and which

are operational in the current year, during the said

relevant period.

Explanation.––For the purposes of this section,––

(a) the “relevant period” shall be––

(i) if the recipients of credit have turnover

in their States or Union territories in the

financial year preceding the year during which

credit is to be distributed, the said financial

year; or

(ii) if some or all recipients of the credit do

not have any turnover in their States or Union

territories in the financial year preceding the

year during which the credit is to be distributed,

the last quarter for which details of such

turnover of all the recipients are available,

previous to the month during which credit is to

be distributed;

(b) the expression “recipient of credit” means

the supplier of goods or services or both having the

same Permanent Account Number as that of the

Input Service Distributor;

44

(c) the term “turnover”,in relation to any

registered person engaged in the supply of taxable

goods as well as goods not taxable under this Act,

means the value of turnover, reduced by the

amount of any duty or tax levied under entry 84 of

List I of the Seventh Schedule to the Constitution

and entry 51 and 54 of List II of the said Schedule.

21. Where the Input Service Distributor distributes the

credit in contravention of the provisions contained in

section 20 resulting in excess distribution of credit to

one or more recipients of credit, the excess credit so

distributed shall be recovered from such recipients

along with interest, and the provisions of section 73 or

section 74, as the case may be, shall, mutatis

mutandis, apply for determination of amount to be

recovered.

Manner of recovery

of credit distributed

in excess.

CHAPTER - VI

REGISTRATION

22. (1) Every supplier making a taxable supply of goods

or services or both in the State shall be liable to be

registered under this Act if his aggregate turnover in

a financial year exceeds twenty lakh rupees:

Persons liable for

registration.

Provided that where such person makes taxable

supplies of goods or services or both from any of the

special category States, he shall be liable to be registered

if his aggregate turnover in a financial year exceeds ten

lakh rupees.

Every supplier making a taxable supply of goods or

services or both in the State, shall be liable to be

registered under this Act if his aggregate turnover in a

financial year exceeds ten lakh rupees.

Only in SGST Law

for special category

States without the

proviso

(2)Every person who, on the day immediately

preceding the appointed day, is registered or holds

45

a license under an existing law, shall be liable to

be registered under this Act with effect from the

appointed day.

(3) Where a business carried on by a taxable person

registered under this Act is transferred, whether

on account of succession or otherwise, to another

person as a going concern, the transferee or the

successor, as the case may be, shall be liable to be

registered with effect from the date of such

transfer or succession.

(4) Notwithstanding anything contained in sub-

sections (1) and (3), in a case of transfer pursuant

to sanction of a scheme or an arrangement for

amalgamation or, as the case may be, de-merger

of two or more companies pursuant to an order of

a High Court, Tribunal or otherwise, the transferee

shall be liable to be registered, with effect from

the date on which the Registrar of Companies

issues a certificate of incorporation giving effect

to such order of the High Court or Tribunal.

Explanation.––For the purposes of this section,––

(i) the expression “aggregate turnover “shall include all

supplies made by the taxable person, whether on his own

account or made on behalf of all his principals;

(ii) the supply of goods, after completion of job work, by

a registered job worker shall be treated as the supply of

goods by the principal referred to in section 143, and the

value of such goods shall not be included in the aggregate

turnover of the registered job worker;

(iii) The expression “special category States” shall mean

the States as specified in sub-clause (g) of clause (4) of

article 279A of the Constitution.

23. (1) The following persons shall not be liable to

registration, namely:––

Persons not liable for

registration.

(a) any person engaged exclusively in the business of

supplying goods or services or both that are not liable to

tax or wholly exempt from tax under this Act or under the

Integrated Goods and Services Tax Act;

(b) An agriculturist, to the extent of supply of produce out

of cultivation of land.

46

(2) The Government may, on the recommendations of

the Council, by notification, specify the category

of persons who may be exempted from obtaining

registration under this Act.

24. Notwithstanding anything contained in sub-section (1)

of section 22, the following categories of persons shall

be required to be registered under this Act,-

Compulsory

registration in certain

cases.

(i) persons making any inter-State taxable supply;

(ii) casual taxable persons making taxable supply;

(iii) persons who are required to pay tax under reverse

charge;

(iv) person who are required to pay tax under sub-section

(5) of section 9;

(v) non-resident taxable persons making taxable supply;

(vi) persons who are required to deduct tax under section

51, whether or not separately registered under this Act;

(vii) persons who make taxable supply of goods or

services or both on behalf of other taxable persons

whether as an agent or otherwise;

(viii) Input Service Distributor, whether or not separately

registered under this Act;

(ix) persons who supply goods or services or both, other

than supplies specified under sub-section (5) of section 9,

through such electronic commerce operator who is

required to collect tax at source under section 52;

(x) every electronic commerce operator;

(xi) every person supplying online information and data

base access or retrieval services from a place outside India

to a person in India, other than a registered person; and

(xii) such other person or class of persons as may be

notified by the Government on the recommendations of

the Council.

25. (1) Every person who is liable to be registered under

section 22or section 24 shall apply for registration

within thirty days from the date on which he

Procedure for

registration.

47

becomes liable to registration, in such manner and

subject to such conditions as may be prescribed:

Provided that a casual taxable person or a non-resident

taxable person shall apply for registration at least five

days prior to the commencement of business.

Explanation.- Every person who makes a supply from

the territorial waters of India shall obtain registration in

the State where the nearest point of the appropriate

baseline is located.

(2) A person seeking registration under this Act shall

be granted a single registration:

Provided that a person having multiple business

verticals in the State may be granted a separate

registration for each business vertical, subject to such

conditions as may be prescribed.

(3) A person, though not liable to be registered under

section 22or section 24 may get himself registered

voluntarily, and all provisions of this Act, as are

applicable to a registered person, shall apply to

such person.

(4) A person who has obtained or is required to obtain

more than one registration, whether in one State or

Union territory or more than one State or Union

territory shall, in respect of each such registration,

be treated as distinct persons for the purposes of

this Act.

(5) Where a person who has obtained or is required to

obtain registration in a State or Union territory in

respect of an establishment, has an establishment

in another State or Union territory, then such

establishments shall be treated as establishments

of distinct persons for the purposes of this Act.

43 of 1961.

(6) Every person shall have a Permanent Account

Number issued under the Income-tax Act, 1961 in

order to be eligible for grant of registration:

Provided that a person required to deduct tax under

section 51mayhave, in lieu of a Permanent Account

Number, a Tax Deduction and Collection Account

Number issued under the said Act in order to be eligible

for grant of registration.

48

(7) Notwithstanding anything contained in sub-

section (6), a non-resident taxable person may be

granted registration under sub-section (1) on the

basis of such other documents as may be

prescribed.

(8) Where a person who is liable to be registered

under this Act fails to obtain registration, the

proper officer may, without prejudice to any

action which may be taken under this Act or under

any other law for the time being in force, proceed

to register such person in such manner as may be

prescribed.

(9) Notwithstanding anything contained in sub-

section (1),––

46 of 1947.

(a) any specialised agency of the United Nations

Organisation or any Multilateral Financial Institution

and Organisation notified under the United Nations

(Privileges and Immunities) Act, 1947, Consulate or

Embassy of foreign countries; and

(b) any other person or class of persons, as may be

notified by the Commissioner,

shall be granted a Unique Identity Number in such

manner and for such purposes, including refund of taxes

on the notified supplies of goods or services or both

received by them, as may be prescribed.

(10) The registration or the Unique Identity

Number shall be granted or rejected after due

verification in such manner and within such

period as may be prescribed.

(11) A certificate of registration shall be issued in

such form and with effect from such date as may

be prescribed.

(12) A registration or a Unique Identity Number

shall be deemed to have been granted after the

expiry of the period prescribed under sub-section

(10), if no deficiency has been communicated to

the applicant within that period.

26. (1) The grant of registration or the Unique Identity Deemed registration.

49

Number under the Central Goods and Services Tax

Act shall be deemed to be a grant of registration or the

Unique Identity Number under this Act subject to the

condition that the application for registration or the

Unique Identity Number has not been rejected under

this Act within the time specified in sub-section (10)

of section 25.

(2) Notwithstanding anything contained in sub-

section (10) of section 25, any rejection of

application for registration or the Unique Identity

Number under the Central Goods and Services

Tax Act shall be deemed to be a rejection of

application for registration under this Act.

27. (1) The certificate of registration issued to a casual

taxable person or a non-resident taxable person shall

be valid for the period specified in the application for

registration or ninety days from the effective date of

registration, whichever is earlier and such person shall

make taxable supplies only after the issuance of the

certificate of registration:

Special provisions

relating to casual

taxable person and

non-resident taxable

person.

Provided that the proper officer may, on sufficient

cause being shown by the said taxable person, extend the

said period of ninety days by a further period not

exceeding ninety days.

(2) A casual taxable person or a non-resident taxable

person shall, at the time of submission of

application for registration under sub-section (1)

of section 25, make an advance deposit of tax in

an amount equivalent to the estimated tax liability

of such person for the period for which the

registration is sought:

Provided that where any extension of time is sought

under sub-section (1), such taxable person shall deposit an

additional amount of tax equivalent to the estimated tax

liability of such person for the period for which the

extension is sought.

(3) The amount deposited under sub-section (2) shall

be credited to the electronic cash ledger of such

person and shall be utilised in the manner

provided under section 49.

50

28. (1) Every registered person and a person to whom a

Unique Identity Number has been assigned shall

inform the proper officer of any changes in the

information furnished at the time of registration or

subsequent thereto, in such form and manner and

within such period as may be prescribed.

Amendment of

registration.

(2) The proper officer may, on the basis of

information furnished under sub-section (1) or as

ascertained by him, approve or reject amendments

in the registration particulars in such manner and

within such period as may be prescribed:

Provided that approval of the proper officer shall not be

required in respect of amendment of such particulars as

may be prescribed:

Provided further that the proper officer shall not reject the

application for amendment in the registration particulars

without giving the person an opportunity of being heard.

(3) Any rejection or approval of amendments under

the Central Goods and Services Tax Act shall be

deemed to be a rejection or approval under this

Act.

29. (1) The proper officer may, either on his own motion

or on an application filed by the registered person or

by his legal heirs, in case of death of such person,

cancel the registration, in such manner and within

such period as may be prescribed, having regard to the

circumstances where,––

Cancellation of

registration.

(a) the business has been discontinued, transferred

fully for any reason including death of the proprietor,

amalgamated with other legal entity, demerged or

otherwise disposed of; or

(b) there is any change in the constitution of the

business; or

(c) the taxable person, other than the person

registered under sub-section (3) of section 25, is no

longer liable to be registered under section 22 or

section 24.

51

(2) The proper officer may cancel the registration of a

person from such date, including any retrospective

date, as he may deem fit, where,––

(a) a registered person has contravened such

provisions of the Act or the rules made there under as

may be prescribed; or

(b) a person paying tax under section 10 has not

furnished returns for three consecutive tax periods; or

(c) any registered person, other than a person

specified in clause (b), has not furnished returns for a

continuous period of six months; or

(d) any person who has taken voluntary registration

under sub-section (3) of section 25has not commenced

business within six months from the date of

registration; or

(e) registration has been obtained by means of

fraud, wilful misstatement or suppression of facts:

Provided that the proper officer shall not cancel

the registration without giving the person an

opportunity of being heard.

(3) The cancellation of registration under this section

shall not affect the liability of the person to pay

tax and other dues under this Act or to discharge

any obligation under this Act or the rules made

there under for any period prior to the date of

cancellation whether or not such tax and other

dues are determined before or after the date of

cancellation.

(4) The cancellation of registration under the Central

Goods and Services Tax Act shall be deemed to

be a cancellation of registration under this Act.

(5) Every registered person whose registration is

cancelled shall pay an amount, by way of debit in

the electronic credit ledger or electronic cash

52

ledger, equivalent to the credit of input tax in

respect of inputs held in stock and inputs

contained in semi-finished or finished goods held

in stock or capital goods or plant and machinery

on the day immediately preceding the date of such

cancellation or the output tax payable on such

goods, whichever is higher, calculated in such

manner as may be prescribed:

Provided that in case of capital goods or plant and

machinery, the taxable person shall pay an amount equal

to the input tax credit taken on the said capital goods or

plant and machinery, reduced by such percentage points

as may be prescribed or the tax on the transaction value of

such capital goods or plant and machinery under section

15, whichever is higher.

(6) The amount payable under sub-section (5) shall be

calculated in such manner as may be prescribed.

30. (1) Subject to such conditions as may be prescribed,

any registered person, whose registration is cancelled

by the proper officer on his own motion, may apply to

such officer for revocation of cancellation of the

registration in the prescribed manner within thirty

days from the date of service of the cancellation order.

Revocation of

cancellation of

registration.

(2) The proper officer may, in such manner and

within such period as may be prescribed, by order,

either revoke cancellation of the registration or

reject the application:

Provided that the application for revocation of

cancellation of registration shall not be rejected unless the

applicant has been given an opportunity of being heard.

(3) The revocation of cancellation of registration

under the Central Goods and Services Tax Act

shall be deemed to be a revocation of cancellation

of registration under this Act.

CHAPTER- VII

TAX INVOICE, CREDIT AND DEBIT NOTES

31. (1) A registered person supplying taxable goods shall, Tax invoice.

53

before or at the time of,––

(a) removal of goods for supply to the recipient,

where the supply involves movement of goods; or

(b) delivery of goods or making available thereof

to the recipient, in any other case,

issue a tax invoice showing the description, quantity and

value of goods, the tax charged thereon and such other

particulars as may be prescribed:

Provided that the Government may, on the

recommendations of the Council, by notification, specify

the categories of goods or supplies in respect of which a

tax invoice shall be issued, within such time and in such

manner as may be prescribed.

(2) A registered person supplying taxable services

shall, before or after the provision of service but

within a prescribed period, issue a tax invoice,

showing the description, value, tax charged

thereon and such other particulars as may be

prescribed:

Provided that the Government may, on the

recommendations of the Council, by notification and

subject to such conditions as may be mentioned therein,

specify the categories of services in respect of which––

(a) any other document issued in relation to the

supply shall be deemed to be a tax invoice; or

(b) tax invoice may not be issued.

(3) Notwithstanding anything contained in sub-

sections (1) and (2)––

(a) a registered person may, within one month from

the date of issuance of certificate of registration and in

such manner as may be prescribed, issue a revised

invoice against the invoice already issued during the

period beginning with the effective date of registration

till the date of issuance of certificate of registration to

him;

54

(b) a registered person may not issue a tax invoice

if the value of the goods or services or both supplied is

less than two hundred rupees subject to such conditions

and in such manner as may be prescribed;

(c) a registered person supplying exempted goods

or services or both or paying tax under the provisions

of section 10 shall issue, instead of a tax invoice, a bill

of supply containing such particulars and in such

manner as may be prescribed:

Provided that the registered person may not issue a

bill of supply if the value of the goods or services or

both supplied is less than two hundred rupees subject

to such conditions and in such manner as may be

prescribed;

(d) a registered person shall, on receipt of advance

payment with respect to any supply of goods or

services or both, issue a receipt voucher or any other

document, containing such particulars as may be

prescribed, evidencing receipt of such payment;

(e) where, on receipt of advance payment with

respect to any supply of goods or services or both the

registered person issues a receipt voucher, but

subsequently no supply is made and no tax invoice is

issued in pursuance thereof, the said registered person

may issue to the person who had made the payment, a

refund voucher against such payment;

(f) a registered person who is liable to pay tax

under sub-section (3) or sub-section (4) of section 9

shall issue an invoice in respect of goods or services or

both received by him from the supplier who is not

registered on the date of receipt of goods or services or

both;

(g) a registered person who is liable to pay tax under sub-

section (3) or sub-section (4) of section 9shall issue a

payment voucher at the time of making payment to the

supplier.

(4) In case of continuous supply of goods, where

successive statements of accounts or successive

payments are involved, the invoice shall be issued

before or at the time each such statement is issued

or, as the case may be, each such payment is

55

received.

(5) Subject to the provisions of clause (d) of sub-

section (3), in case of continuous supply of

services,––

(a) where the due date of payment is ascertainable

from the contract, the invoice shall be issued on or

before the due date of payment;

(b) where the due date of payment is not

ascertainable from the contract, the invoice shall be

issued before or at the time when the supplier of

service receives the payment;

(c) where the payment is linked to the completion

of an event, the invoice shall be issued on or before

the date of completion of that event.

(6) In a case where the supply of services ceases

under a contract before the completion of the

supply, the invoice shall be issued at the time

when the supply ceases and such invoice shall be

issued to the extent of the supply made before

such cessation.

(7) Notwithstanding anything contained in sub-

section (1), where the goods being sent or taken

on approval for sale or return are removed before

the supply takes place, the invoice shall be issued

before or at the time of supply or six months from

the date of removal, whichever is earlier.

Explanation.––For the purposes of this section, the

expression “tax invoice” shall include any revised invoice

issued by the supplier in respect of a supply made earlier.

32. (1) A person who is not a registered person shall not

collect in respect of any supply of goods or services or

both any amount by way of tax under this Act.

Prohibition of

unauthorised

collection of tax

(2) No registered person shall collect tax except in

accordance with the provisions of this Act or the

rules made there under.

33. Notwithstanding anything contained in this Act or any

other law for the time being in force, where any

Amount of tax to be

indicated in tax

56

supply is made for a consideration, every person who

is liable to pay tax for such supply shall prominently

indicate in all documents relating to assessment, tax

invoice and other like documents, the amount of tax

which shall form part of the price at which such

supply is made.

invoice and other

documents.

34. (1) Where a tax invoice has been issued for supply of

any goods or services or both and the taxable value or

tax charged in that tax invoice is found to exceed the

taxable value or tax payable in respect of such supply,

or where the goods supplied are returned by the

recipient, or where goods or services or both supplied

are found to be deficient, the registered person, who

has supplied such goods or services or both, may issue

to the recipient a credit note containing such

particulars as may be prescribed.

Credit and debit

notes.

(2) Any registered person who issues a credit note in

relation to a supply of goods or services or both

shall declare the details of such credit note in the

return for the month during which such credit note

has been issued but not later than September

following the end of the financial year in which

such supply was made, or the date of furnishing of

the relevant annual return, whichever is earlier,

and the tax liability shall be adjusted in such

manner as may be prescribed:

Provided that no reduction in output tax liability of the

supplier shall be permitted, if the incidence of tax and

interest on such supply has been passed on to any other

person.

(3) Where a tax invoice has been issued for supply of

any goods or services or both and the taxable

value or tax charged in that tax invoice is found to

be less than the taxable value or tax payable in

respect of such supply, the registered person, who

has supplied such goods or services or both, shall

issue to the recipient a debit note containing such

particulars as may be prescribed.

(4) Any registered person who issues a debit note in

relation to a supply of goods or services or both

shall declare the details of such debit note in the

57

return for the month during which such debit note

has been issued and the tax liability shall be

adjusted in such manner as may be prescribed.

Explanation.––For the purposes of this Act, the

expression “debit note” shall include a supplementary

invoice.

CHAPTER VIII

ACCOUNTS AND RECORDS

35. (1) Every registered person shall keep and maintain, at

his principal place of business, as mentioned in the

certificate of registration, a true and correct account

of-

(a) production or manufacture of goods;

(b) inward and outward supply of goods or services or

both;

(c) stock of goods;

(d) input tax credit availed;

(e) output tax payable and paid; and

(f) such other particulars as may be prescribed:

Accounts and other

records.

Provided that where more than one place of business is

specified in the certificate of registration, the accounts

relating to each place of business shall be kept at such

places of business:

Provided further that the registered person may keep

and maintain such accounts and other particulars in

electronic form in such manner as may be prescribed.

(2) Every owner or operator of warehouse or godown

or any other place used for storage of goods and

every transporter, irrespective of whether he is a

registered person or not, shall maintain records of

the consigner, consignee and other relevant details

of the goods in such manner as may be prescribed.

(3) The Commissioner may notify a class of taxable

persons to maintain additional accounts or

documents for such purpose as may be specified

therein.

(4) Where the Commissioner considers that any class

58

of taxable persons is not in a position to keep and

maintain accounts in accordance with the

provisions of this section, he may, for reasons to

be recorded in writing, permit such class of

taxable persons to maintain accounts in such

manner as may be prescribed.

(5) Every registered person whose turnover during a

financial year exceeds the prescribed limit shall

get his accounts audited by a chartered accountant

or a cost accountant and shall submit a copy of the

audited annual accounts, the reconciliation

statement under sub-section (2) of section 44 and

such other documents in such form and manner as

may be prescribed.

(6) Subject to the provisions of clause (h) of sub-

section (5) of section 17, where the registered

person fails to account for the goods or services or

both in accordance with the provisions of sub-

section (1), the proper officer shall determine the

amount of tax payable on the goods or services or

both that are not accounted for, as if such goods or

services or both had been supplied by such person

and the provisions of section 73 or section74, as

the case maybe, shall, mutatis mutandis, apply for

determination of such tax.

36. Every registered person required to keep and maintain

books of account or other records in accordance with

the provisions of sub-section (1) of section 35 shall

retain them until the expiry of seventy two months

from the due date of furnishing of annual return for

the year pertaining to such accounts and records:

Period of retention of

accounts.

Provided that a registered person, who is a party to an

appeal or revision or any other proceedings before any

Appellate Authority or Revisional Authority or Appellate

Tribunal or court, whether filed by him or by the

Commissioner, or is under investigation for an offence

under Chapter XIX, shall retain the books of account and

other records pertaining to the subject matter of such

appeal or revision or proceedings or investigation for a

period of one year after final disposal of such appeal or

revision or proceedings or investigation, or for the period

specified above, whichever is later.

59

CHAPTER- IX

RETURNS

37. (1) Every registered person, other than an Input

Service Distributor, a non-resident taxable person and

a person paying tax under the provisions of section 10

or section 51 or section 52, shall furnish,

electronically, in such form and manner as may be

prescribed, the details of outward supplies of goods or

services or both effected during a tax period on or

before the tenth day of the month succeeding the said

tax period and such details shall be communicated to

the recipient of the said supplies within such time and

in such manner as may be prescribed:

Furnishing details of

outward supplies.

Provided that the registered person shall not be allowed to

furnish the details of outward supplies during the period

from the eleventh day to the fifteenth day of the month

succeeding the tax period:

Provided further that the Commissioner may, for

reasons to be recorded in writing, by notification, extend

the time limit for furnishing such details for such class of

taxable persons as may be specified therein:

Provided also that any extension of time limit notified

by the Commissioner of central tax shall be deemed to be

notified by the Commissioner.

(2) Every registered person who has been

communicated the details under sub-section (3) of

section 38 or the details pertaining to inward

supplies of Input Service Distributor under sub-

section (4) of section 38, shall either accept or

reject the details so communicated, on or before

the seventeenth day, but not before the fifteenth

day, of the month succeeding the tax period and

the details furnished by him under sub-section (1)

shall stand amended accordingly.

(3) Any registered person, who has furnished the

details under sub-section (1) for any tax period

and which have remained unmatched under

section 42 or section 43, shall, upon discovery of

60

any error or omission therein, rectify such error or

omission in such manner as may be prescribed,

and shall pay the tax and interest, if any, in case

there is a short payment of tax on account of such

error or omission, in the return to be furnished for

such tax period:

Provided that no rectification of error or omission in

respect of the details furnished under sub-section (1) shall

be allowed after furnishing of the return under section 39

for the month of September following the end of the

financial year to which such details pertain, or furnishing

of the relevant annual return, whichever is earlier.

Explanation.––For the purposes of this Chapter, the

expression “details of outward supplies” shall include

details of invoices, debit notes, credit notes and revised

invoices issued in relation to outward supplies made

during any tax period.

38. (1) Every registered person, other than an Input

Service Distributor or a non-resident taxable person or

a person paying tax under the provisions of section 10

or section 51 or section 52, shall verify, validate,

modify or delete, if required, the details relating to

outward supplies and credit or debit notes

communicated under sub-section (1) of section 37 to

prepare the details of his inward supplies and credit or

debit notes and may include therein, the details of

inward supplies and credit or debit notes received by

him in respect of such supplies that have not been

declared by the supplier under sub-section (1) of

section 37.

Furnishing details of

inward supplies.

(2) Every registered person, other than an Input

Service Distributor or a non-resident taxable

person or a person paying tax under the provisions

of section 10 or section 51 or section 52, shall

furnish, electronically, the details of inward

supplies of taxable goods or services or both,

including inward supplies of goods or services or

both on which the tax is payable on reverse charge

basis under this Act and inward supplies of goods

or services or both taxable under the Integrated

Goods and Services Tax Act or on which

integrated goods and services tax is payable under

61

section 3 of the Customs Tariff Act, 1975, and

credit or debit notes received in respect of such

supplies during a tax period after the tenth day but

on or before the fifteenth day of the month

succeeding the tax period in such form and

manner as may be prescribed:

Provided that the Commissioner may, for reasons to be

recorded in writing, by notification, extend the time limit

for furnishing such details for such class of taxable

persons as may be specified therein:

Provided further that any extension of time limit

notified by the Commissioner of central tax shall be

deemed to be notified by the Commissioner.

(3) The details of supplies modified, deleted or

included by the recipient and furnished under sub-

section (2)shall be communicated to the supplier

concerned in such manner and within such time as

may be prescribed.

(4) The details of supplies modified, deleted or

included by the recipient in the return furnished

under sub-section (2) or sub-section (4) of section

39 shall be communicated to the supplier

concerned in such manner and within such time as

may be prescribed.

(5) Any registered person, who has furnished the

details under sub-section (2) for any tax period

and which have remained unmatched under

section 42 or section 43, shall, upon discovery of

any error or omission therein, rectify such error or

omission in the tax period during which such error

or omission is noticed in such manner as may be

prescribed, and shall pay the tax and interest, if

any, in case there is a short payment of tax on

account of such error or omission, in the return to

be furnished for such tax period:

Provided that no rectification of error or omission in

respect of the details furnished under sub-section (2) shall

be allowed after furnishing of the return under section 39

for the month of September following the end of the

financial year to which such details pertain, or furnishing

of the relevant annual return, whichever is earlier.

62

39. (1) Every registered person, other than an Input

Service Distributor or a non-resident taxable person or

a person paying tax under the provisions of section 10

or section 51 or section 52 shall, for every calendar

month or part thereof, furnish, in such form and

manner as may be prescribed, a return, electronically,

of inward and outward supplies of goods or services

or both, input tax credit availed, tax payable, tax paid

and such other particulars as may be prescribed on or

before the twentieth day of the month succeeding such

calendar month or part thereof.

Furnishing of returns.

(2) A registered person paying tax under the

provisions of section 10 shall, for each quarter or

part thereof, furnish, in such form and manner as

may be prescribed, a return, electronically, of

turnover in the State, inward supplies of goods or

services or both, tax payable and tax paid within

eighteen days after the end of such quarter.

(3) Every registered person required to deduct tax at

source under the provisions of section 51 shall

furnish, in such form and manner as may be

prescribed, a return, electronically, for the month

in which such deductions have been made within

ten days after the end of such month.

(4) Every taxable person registered as an Input

Service Distributor shall, for every calendar

month or part thereof, furnish, in such form and

manner as may be prescribed, a return,

electronically, within thirteen days after the end of

such month.

(5) Every registered non-resident taxable person shall,

for every calendar month or part thereof, furnish,

in such form and manner as may be prescribed, a

return, electronically, within twenty days after the

end of a calendar month or within seven days after

the last day of the period of registration specified

under sub-section(1) of section 27, whichever is

earlier.

(6) The Commissioner may, for reasons to be

recorded in writing, by notification, extend the

time limit for furnishing the returns under this

63

section for such class of registered persons as may

be specified therein:

Provided that any extension of time limit notified by

the Commissioner of central tax shall be deemed to be

notified by the Commissioner.

(7) Every registered person, who is required to

furnish a return under sub-section (1) or sub-

section (2) or sub-section (3) or sub-section (5),

shall pay to the Government the tax due as per

such return not later than the last date on which he

is required to furnish such return.

(8) Every registered person who is required to furnish

a return under sub-section (1) or sub-section (2)

shall furnish a return for every tax period whether

or not any supplies of goods or services or both

have been made during such tax period.

(9) Subject to the provisions of sections 37 and 38, if

any registered person after furnishing a return

under sub-section (1)or sub-section (2) sub-

section (3) or sub-section (4) or sub-section (5)

discovers any omission or incorrect particulars

therein, other than as a result of scrutiny, audit,

inspection or enforcement activity by the tax

authorities, he shall rectify such omission or

incorrect particulars in the return to be furnished

for the month or quarter during which such

omission or incorrect particulars are noticed,

subject to payment of interest under this Act:

Provided that no such rectification of any omission or

incorrect particulars shall be allowed after the due date for

furnishing of return for the month of September or second

quarter following the end of the financial year, or the

actual date of furnishing of relevant annual return,

whichever is earlier.

(10) A registered person shall not be allowed to

furnish a return for a tax period if the return for

any of the previous tax periods has not been

furnished by him.

40. Every registered person who has made outward First Return.

64

supplies in the period between the date on which he

became liable to registration till the date on which

registration has been granted shall declare the same in

the first return furnished by him after grant of

registration.

41. (1) Every registered person shall, subject to such

conditions and restrictions as may be prescribed, be

entitled to take the credit of eligible input tax, as self-

assessed, in his return and such amount shall be

credited on a provisional basis to his electronic credit

ledger.

Claim of input tax

credit and provisional

acceptance thereof.

(2) The credit referred to in sub-section (1) shall

be utilised only for payment of self-assessed

output tax as per the return referred to in the said

sub-section.

42. (1) The details of every inward supply furnished by a

registered person (hereafter in this section referred to

as the “recipient”) for a tax period shall, in such

manner and within such time as may be prescribed, be

matched––

Matching, reversal

and reclaim of input

tax credit.

(a) with the corresponding details of outward

supply furnished by the corresponding registered

person (hereafter in this section referred to as the

“supplier”) in his valid return for the same tax period

or any preceding tax period;

51 of 1975.

(b) with the integrated goods and services tax paid

under section 3 of the Customs Tariff Act, 1975 in

respect of goods imported by him; and

(c) for duplication of claims of input tax credit.

51 of 1975

(2) The claim of input tax credit in respect of invoices

or debit notes relating to inward supply that match

with the details of corresponding outward supply

or with the integrated goods and services tax paid

under section 3 of the Customs Tariff Act, 1975 in

respect of goods imported by him shall be finally

accepted and such acceptance shall be

communicated, in such manner as may be

prescribed, to the recipient.

65

(3) Where the input tax credit claimed by a recipient

in respect of an inward supply is in excess of the

tax declared by the supplier for the same supply or

the outward supply is not declared by the supplier

in his valid returns, the discrepancy shall be

communicated to both such persons in such

manner as may be prescribed.

(4) The duplication of claims of input tax credit shall

be communicated to the recipient in such manner

as may be prescribed.

(5) The amount in respect of which any discrepancy

is communicated under sub-section (3) and which

is not rectified by the supplier in his valid return

for the month in which discrepancy is

communicated shall be added to the output tax

liability of the recipient, in such manner as may be

prescribed, in his return for the month succeeding

the month in which the discrepancy is

communicated.

(6) The amount claimed as input tax credit that is

found to be in excess on account of duplication of

claims shall be added to the output tax liability of

the recipient in his return for the month in which

the duplication is communicated.

(7) The recipient shall be eligible to reduce, from his

output tax liability, the amount added under sub-

section (5), if the supplier declares the details of

the invoice or debit note in his valid return within

the time specified in sub-section (9) of section 39.

(8) A recipient in whose output tax liability any

amount has been added under sub-section (5)

orsub-section (6), shall be liable to pay interest at

the rate specified under sub-section (1) of section

50 on the amount so added from the date of

availing of credit till the corresponding additions

are made under the said sub-sections.

(9) Where any reduction in output tax liability is

accepted under sub-section (7), the interest paid

under sub-section (8) shall be refunded to the

recipient by crediting the amount in the

66

corresponding head of his electronic cash ledger

in such manner as may be prescribed:

Provided that the amount of interest to be credited in

any case shall not exceed the amount of interest paid by

the supplier.

(10) The amount reduced from the output tax

liability in contravention of the provisions of sub-

section (7) shall be added to the output tax

liability of the recipient in his return for the month

in which such contravention takes place and such

recipient shall be liable to pay interest on the

amount so added at the rate specified in sub-

section (3) of section 50.

43. (1) The details of every credit note relating to outward

supply furnished by a registered person (hereafter in

this section referred to as the “supplier”) for a tax

period shall, in such manner and within such time as

may be prescribed, be matched––

Matching, reversal

and reclaim of

reduction in output

tax liability.

(a) with the corresponding reduction in the claim

for input tax credit by the corresponding registered

person (hereafter in this section referred to as the

“recipient”) in his valid return for the same tax period

or any subsequent tax period; and

(b) for duplication of claims for reduction in output

tax liability.

(2) The claim for reduction in output tax liability by

the supplier that matches with the corresponding

reduction in the claim for input tax credit by the

recipient shall be finally accepted and

communicated, in such manner as may be

prescribed, to the supplier.

(3) Where the reduction of output tax liability in

respect of outward supplies exceeds the

corresponding reduction in the claim for input tax

credit or the corresponding credit note is not

declared by the recipient in his valid returns, the

discrepancy shall be communicated to both such

persons in such manner as may be prescribed.

67

(4) The duplication of claims for reduction in output

tax liability shall be communicated to the supplier

in such manner as may be prescribed.

(5) The amount in respect of which any discrepancy

is communicated under sub-section (3) and which

is not rectified by the recipient in his valid return

for the month in which discrepancy is

communicated shall be added to the output tax

liability of the supplier, in such manner as may be

prescribed, in his return for the month succeeding

the month in which the discrepancy is

communicated.

(6) The amount in respect of any reduction in output

tax liability that is found to be on account of

duplication of claims shall be added to the output

tax liability of the supplier in his return for the

month in which such duplication is

communicated.

(7) The supplier shall be eligible to reduce, from his

output tax liability, the amount added under sub-

section (5) if the recipient declares the details of

the credit note in his valid return within the time

specified in sub-section (9) of section 39.

(8) A supplier in whose output tax liability any

amount has been added under sub-section (5)

orsub-section (6), shall be liable to pay interest at

the rate specified under sub-section (1) of section

50 in respect of the amount so added from the date

of such claim for reduction in the output tax

liability till the corresponding additions are made

under the said sub-sections.

(9) Where any reduction in output tax liability is

accepted under sub-section (7), the interest paid

under sub-section (8) shall be refunded to the

supplier by crediting the amount in the

corresponding head of his electronic cash ledger

in such manner as may be prescribed:

Provided that the amount of interest to be credited in

any case shall not exceed the amount of interest paid by

the recipient.

68

(10) The amount reduced from output tax liability

in contravention of the provisions of sub-section

(7) shall be added to the output tax liability of the

supplier in his return for the month in which such

contravention takes place and such supplier shall

be liable to pay interest on the amount so added at

the rate specified in sub-section (3) of section 50.

44. (1) Every registered person, other than an Input

Service Distributor, a person paying tax under section

51 or section 52, a casual taxable person and a non-

resident taxable person, shall furnish an annual return

for every financial year electronically in such form

and manner as may be prescribed on or before the

thirty-first day of December following the end of such

financial year.

Annual return.

(2) Every registered person who is required to get his

accounts audited in accordance with the

provisions of sub-section (5) of section 35 shall

furnish, electronically, the annual return under

sub-section (1) along with a copy of the audited

annual accounts and a reconciliation statement,

reconciling the value of supplies declared in the

return furnished for the financial year with the

audited annual financial statement, and such other

particulars as may be prescribed.

45. Every registered person who is required to furnish a

return under sub-section (1) of section 39 and whose

registration has been cancelled shall furnish a final

return within three months of the date of cancellation

or date of order of cancellation, whichever is later, in

such form and manner as may be prescribed.

Final return.

46. Where a registered person fails to furnish a return

under section 39 or section 44 or section 45, a notice

shall be issued requiring him to furnish such return

within fifteen days in such form and manner as may

be prescribed.

Notice to return

defaulters.

47. (1) Any registered person who fails to furnish the

details of outward or inward supplies required under

section 37 or section 38 or returns required under

section 39 or section 45 by the due date shall pay a

late fee of one hundred rupees for every day during

Levy of late fee.

69

which such failure continues subject to a maximum

amount of five thousand rupees.

(2) Any registered person who fails to furnish the

return required under section 44 by the due date

shall be liable to pay a late fee of one hundred

rupees for every day during which such failure

continues subject to a maximum of an amount

calculated at a quarter per cent. of his turnover in

the State.

48. (1) The manner of approval of goods and services tax

practitioners, their eligibility conditions, duties and

obligations, manner of removal and other conditions

relevant for their functioning shall be such as may be

prescribed.

Goods and services

tax practitioners.

(2) A registered person may authorise an approved

goods and services tax practitioner to furnish the

details of outward supplies under section 37, the

details of inward supplies under section 38 and the

return under section 39 or section 44 or section

45in such manner as may be prescribed.

(3) Notwithstanding anything contained in sub-

section (2), the responsibility for correctness of

any particulars furnished in the return or other

details filed by the goods and services tax

practitioners shall continue to rest with the

registered person on whose behalf such return and

details are furnished.

CHAPTER-X

PAYMENT OF TAX

49. (1) Every deposit made towards tax, interest, penalty,

fee or any other amount by a person by internet

banking or by using credit or debit cards or National

Electronic Fund Transfer or Real Time Gross

Settlement or by such other mode and subject to such

conditions and restrictions as may be prescribed, shall

be credited to the electronic cash ledger of such

person to be maintained in such manner as may be

prescribed.

Payment of tax,

interest, penalty and

other amounts.

70

(2) The input tax credit as self-assessed in the return

of a registered person shall be credited to his

electronic credit ledger, in accordance with

section 41, to be maintained in such manner as

may be prescribed.

(3) The amount available in the electronic cash ledger

may be used for making any payment towards tax,

interest, penalty, fees or any other amount payable

under the provisions of this Act or the rules made

there under in such manner and subject to such

conditions and within such time as may be

prescribed.

(4) The amount available in the electronic credit

ledger may be used for making any payment

towards output tax under this Act or under the

Integrated Goods and Services Tax Act in such

manner and subject to such conditions and within

such time as may be prescribed.

(5) The amount of input tax credit available in the

electronic credit ledger of the registered person on

account of ––

(a) integrated tax shall first be utilised towards

payment of integrated tax and the amount

remaining, if any, may be utilised towards the

payment of central tax and State tax, or as the case

may be, Union territory tax, in that order;

(b) the central tax shall first be utilised towards

payment of central tax and the amount remaining, if

any, may be utilised towards the payment of integrated

tax;

(c) the State tax shall first be utilised towards

payment of State tax and the amount remaining, if

any, may be utilised towards the payment of

integrated tax;

(d)the Union territory tax shall first be utilised

towards payment of Union territory tax and the

amount remaining, if any, may be utilised towards

the payment of integrated tax;

71

(e) the central tax shall not be utilised towards

payment of State tax or Union territory tax; and

(f) the State tax or Union territory tax shall not be

utilised towards payment of central tax.

(6) The balance in the electronic cash ledger or

electronic credit ledger after payment of tax,

interest, penalty, fee or any other amount payable

under this Act or the rules made there under may

be refunded in accordance with the provisions of

section 54.

(7) All liabilities of a taxable person under this Act

shall be recorded and maintained in an electronic

liability register in such manner as may be

prescribed.

(8) Every taxable person shall discharge his tax and

other dues under this Act or the rules made there

under in the following order, namely:––

(a) self-assessed tax, and other dues related to

returns of previous tax periods;

(b) self-assessed tax, and other dues related to the

return of the current tax period;

(c) any other amount payable under this Act or the

rules made there under including the demand

determined under section 73 or section 74.

(9) Every person who has paid the tax on goods or

services or both under this Act shall, unless the

contrary is proved by him, be deemed to have

passed on the full incidence of such tax to the

recipient of such goods or services or both.

72

Explanation.––For the purposes of this section,

(a) the date of

credit to the account of the Government in the

authorised bank shall be deemed to be the date of

deposit in the electronic cash ledger;

(b) the

expression,-

(i) “tax dues” means the tax payable under this Act

and does not include interest, fee and penalty; and

(ii) “other dues” means interest, penalty, fee or any

other amount payable under this Act or the rules

made there under.

50. (1) Every person who is liable to pay tax in

accordance with the provisions of this Act or the rules

made there under, but fails to pay the tax or any part

thereof to the Government within the period

prescribed, shall for the period for which the tax or

any part thereof remains unpaid, pay, on his own,

interest at such rate, not exceeding eighteen per cent.,

as may be notified by the Government on the

recommendations of the Council.

Interest on delayed

payment of tax.

(2) The interest under sub-section (1) shall be

calculated, in such manner as may be prescribed,

from the day succeeding the day on which such

tax was due to be paid.

(3) A taxable person who makes an undue or excess

claim of input tax credit under sub-section (10) of

section 42 or undue or excess reduction in output

tax liability under sub-section (10) of section 43,

shall pay interest on such undue or excess claim or

on such undue or excess reduction, as the case

may be, at such rate not exceeding twenty-four per

cent., as may be notified by the Government on

the recommendations of the Council.

51. (1) Notwithstanding anything to the contrary

contained in this Act, the Government may mandate,-

Tax deduction at

source.

(a) a department or establishment of the Central

Government or State Government; or

(b) local authority; or

73

(c) Governmental agencies; or

(d) such persons or category of persons as may be

notified by the Government on the recommendations

of the Council,

(hereafter in this section referred to as “the deductor”), to

deduct tax at the rate of one per cent. from the payment

made or credited to the supplier (hereafter in this section

referred to as “the deductee”) of taxable goods or services

or both, where the total value of such supply, under a

contract, exceeds two lakh and fifty thousand rupees:

Provided that no deduction shall be made if the location

of the supplier and the place of supply is in a State or

Union territory which is different from the State or, as the

case may be, Union territory of registration of the

recipient.

Explanation.––For the purpose of deduction of tax

specified above, the value of supply shall be taken as the

amount excluding the central tax, State tax, integrated tax

and cess indicated in the invoice.

(2) The amount deducted as tax under this section

shall be paid to the Government by the deductor

within ten days after the end of the month in

which such deduction is made, in such manner as

may be prescribed.

(3) The deductor shall furnish to the deductee a

certificate mentioning therein the contract value,

rate of deduction, amount deducted, amount paid

to the Government and such other particulars in

such manner as may be prescribed.

(4) If any deductor fails to furnish to the deductee the

certificate, after deducting the tax at source,

within five days of crediting the amount so

deducted to the Government, the deductor shall

pay, by way of a late fee, a sum of one hundred

rupees per day from the day after the expiry of

such five day period until the failure is rectified,

subject to a maximum amount of five thousand

74

rupees.

(5) The deductee shall claim credit, in his electronic

cash ledger, of the tax deducted and reflected in

the return of the deductor furnished under sub-

section (3) of section 39, in such manner as may

be prescribed.

(6) If any deductor fails to pay to the Government the

amount deducted as tax under sub-section (1), he

shall pay interest in accordance with the

provisions of sub-section (1) of section 50, in

addition to the amount of tax deducted.

(7) The determination of the amount in default under

this section shall be made in the manner specified

in section 73 or section74.

(8) The refund to the deductor or the deductee arising

on account of excess or erroneous deduction shall

be dealt with in accordance with the provisions of

section 54:

Provided that no refund to the deductor shall be

granted, if the amount deducted has been credited to the

electronic cash ledger of the deductee.

52. (1) Notwithstanding anything to the contrary

contained in this Act, every electronic commerce

operator (hereafter in this section referred to as the

“operator”), not being an agent, shall collect an

amount calculated at such rate not exceeding one per

cent., as may be notified by the Government on the

recommendations of the Council, of the net value of

taxable supplies made through it by other suppliers

where the consideration with respect to such supplies

is to be collected by the operator.

Collection of tax at

source.

Explanation.––For the purposes of this sub-section, the

expression "net value of taxable supplies" shall mean the

aggregate value of taxable supplies of goods or services or

both, other than services notified under sub-section (5) of

section 9, made during any month by all registered

persons through the operator reduced by the aggregate

value of taxable supplies returned to the suppliers during

the said month.

75

(2) The power to collect the amount specified in sub-

section (1) shall be without prejudice to any other

mode of recovery from the operator.

(3) The amount collected under sub-section (1) shall

be paid to the Government by the operator within

ten days after the end of the month in which such

collection is made, in such manner as may be

prescribed.

(4) Every operator who collects the amount specified

in sub-section (1) shall furnish a statement,

electronically, containing the details of outward

supplies of goods or services or both effected

through it, including the supplies of goods or

services or both returned through it, and the

amount collected under sub-section (1) during a

month, in such form and manner as may be

prescribed, within ten days after the end of such

month.

(5) Every operator who collects the amount specified

in sub-section (1) shall furnish an annual

statement, electronically, containing the details of

outward supplies of goods or services or both

effected through it, including the supplies of

goods or services or both returned through it, and

the amount collected under the said sub-section

during the financial year, in such form and manner

as may be prescribed, before the thirty first day of

December following the end of such financial

year.

(6) If any operator after furnishing a statement under

sub-section (4) discovers any omission or

incorrect particulars therein, other than as a result

of scrutiny, audit, inspection or enforcement

activity by the tax authorities, he shall rectify such

omission or incorrect particulars in the statement

to be furnished for the month during which such

omission or incorrect particulars are noticed,

subject to payment of interest, as specified in sub-

section (1) of section 50:

Provided that no such rectification of any

76

omission or incorrect particulars shall be allowed

after the due date for furnishing of statement for

the month of September following the end of the

financial year or the actual date of furnishing of

the relevant annual statement, whichever is

earlier.

(7) The supplier who has supplied the goods or

services or both through the operator shall claim

credit, in his electronic cash ledger, of the amount

collected and reflected in the statement of the

operator furnished under sub-section (4), in such

manner as may be prescribed.

(8) The details of supplies furnished by every

operator under sub-section (4) shall be matched

with the corresponding details of outward supplies

furnished by the concerned supplier registered

under this Act in such manner and within such

time as may be prescribed.

(9) Where the details of outward supplies furnished

by the operator under sub-section (4) do not match

with the corresponding details furnished by the

supplier under section 37, the discrepancy shall be

communicated to both persons in such manner and

within such time as may be prescribed.

(10) The amount in respect of which any

discrepancy is communicated under sub-section

(9) and which is not rectified by the supplier in his

valid return or the operator in his statement for the

month in which discrepancy is communicated,

shall be added to the output tax liability of the said

supplier, where the value of outward supplies

furnished by the operator is more than the value of

outward supplies furnished by the supplier, in his

return for the month succeeding the month in

which the discrepancy is communicated in such

manner as may be prescribed.

(11) The concerned supplier, in whose output tax

liability any amount has been added under sub-

section (10), shall pay the tax payable in respect

of such supply along with interest, at the rate

specified under sub-section (1) of section 50 on

77

the amount so added from the date such tax was

due till the date of its payment.

(12) Any authority not below the rank of Deputy

Commissioner may serve a notice, either before or

during the course of any proceedings under this

Act, requiring the operator to furnish such details

relating to—

(a) supplies of goods or services or both effected

through such operator during any period; or

(b) stock of goods held by the suppliers making

supplies through such operator in the godowns or

warehouses, by whatever name called, managed

by such operator and declared as additional

places of business by such suppliers,

as may be specified in the notice.

(13) Every operator on whom a notice has been

served under sub-section (12) shall furnish the

required information within fifteen working days

of the date of service of such notice.

(14) Any person who fails to furnish the

information required by the notice served under

sub-section (12) shall, without prejudice to any

action that may be taken under section 122, be

liable to a penalty which may extend to twenty-

five thousand rupees.

Explanation.—For the purposes of this section,

the expression “concerned supplier” shall mean

the supplier of goods or services or both making

supplies through the operator.

53. On utilisation of input tax credit availed under this Act

for payment of tax dues under the Integrated Goods

and Services Tax Act in accordance with the

provisions of sub-section (5) of section 49, as

reflected in the valid return furnished under sub-

section (1) of section 39, the amount collected as State

tax shall stand reduced by an amount equal to such

credit so utilised and the State Government shall

transfer an amount equal to the amount so reduced

Transfer of input tax

credit.

78

from the State tax account to the integrated tax

account in such manner and within such time as may

be prescribed.

CHAPTER XI

REFUNDS

54. (1) Any person claiming refund of any tax and

interest, if any, paid on such tax or any other amount

paid by him, may make an application before the

expiry of two years from the relevant date in such

form and manner as may be prescribed:

Refund of tax.

Provided that a registered person, claiming refund of

any balance in the electronic cash ledger in accordance

with the provisions of sub-section (6) of section49, may

claim such refund in the return furnished under section 39

in such manner as may be prescribed.

46 of 1947.

(2) A specialized agency of the United Nations

Organization or any Multilateral Financial

Institution and Organization notified under the

United Nations (Privileges and Immunities) Act,

1947, Consulate or Embassy of foreign countries

or any other person or class of persons, as notified

under section 55, entitled to a refund of tax paid

by it on inward supplies of goods or services or

both, may make an application for such refund, in

such form and manner as may be prescribed,

before the expiry of six months from the last day

of the quarter in which such supply was received.

(3) Subject to the provisions of sub-section (10), a

registered person may claim refund of any

unutilised input tax credit at the end of any tax

period:

Provided that no refund of unutilised input tax credit

shall be allowed in cases other than-

(i) zero-rated supplies made without payment of tax;

(ii) where the credit has accumulated on account of

rate of tax on inputs being higher than the rate of tax on

output supplies (other than nil rated or fully exempt

supplies), except supplies of goods or services or both as

79

may be notified by the Government on the

recommendations of the Council:

Provided further that no refund of unutilised input tax

credit shall be allowed in cases where the goods exported

out of India are subjected to export duty:

Provided also that no refund of input tax credit shall be

allowed, if the supplier of goods or services or both

claims refund of the integrated tax paid on such supplies.

(4) The application shall be accompanied by—

(a) such documentary evidence as may be prescribed to

establish that a refund is due to the applicant; and

(b) such documentary or other evidence (including the

documents referred to in section 33) as the applicant may

furnish to establish that the amount of tax and interest, if

any, paid on such tax or any other amount paid in relation

to which such refund is claimed was collected from, or

paid by, him and the incidence of such tax and interest

had not been passed on to any other person:

Provided that where the amount claimed as refund is

less than two lakh rupees, it shall not be necessary for the

applicant to furnish any documentary and other evidences

but he may file a declaration, based on the documentary

or other evidences available with him, certifying that the

incidence of such tax and interest had not been passed on

to any other person.

(5) If, on receipt of any such application, the proper

officer is satisfied that the whole or part of the

amount claimed as refund is refundable, he may

make an order accordingly and the amount so

determined shall be credited to the Fund referred

to in section 57.

(6) Notwithstanding anything contained in sub-

section (5), the proper officer may, in the case of

any claim for refund on account of zero-rated

supply of goods or services or both made by

registered persons, other than such category of

registered persons as may be notified by the

Government on the recommendations of the

Council, refund on a provisional basis, ninety per

80

cent. of the total amount so claimed, excluding the

amount of input tax credit provisionally accepted,

in such manner and subject to such conditions,

limitations and safeguards as may be prescribed

and thereafter make an order under sub-section (5)

for final settlement of the refund claim after due

verification of documents furnished by the

applicant.

(7) The proper officer shall issue the order under sub-

section (5) within sixty days from the date of

receipt of application complete in all respects.

(8) Notwithstanding anything contained in sub-

section (5), the refundable amount shall, instead of

being credited to the Fund, be paid to the

applicant, if such amount is relatable to –

(a) refund of tax paid on zero-rated supplies of

goods or services or both or on inputs or input services

used in making such zero-rated supplies;

(b) refund of unutilised input tax credit under sub-

section (3);

(c) refund of tax paid on a supply which is not

provided, either wholly or partially, and for which

invoice has not been issued, or where a refund voucher

has been issued;

(d) refund of tax in pursuance of section 77;

(e) the tax and interest, if any, or any other amount

paid by the applicant, if he had not passed on the

incidence of such tax and interest to any other person;

or

(f) the tax or interest borne by such other class of

applicants as the Government may, on the

recommendations of the Council, by notification,

specify.

(9) Notwithstanding anything to the contrary

contained in any judgment, decree, order or

direction of the Appellate Tribunal or any court or

in any other provisions of this Act or the rules

81

made there under or in any other law for the time

being in force, no refund shall be made except in

accordance with the provisions of sub-section (8).

(10) Where any refund is due under sub-section (3)

to a registered person who has defaulted in

furnishing any return or who is required to pay

any tax, interest or penalty, which has not been

stayed by any court, Tribunal or Appellate

Authority by the specified date, the proper officer

may—

(a) withhold payment of refund due until the said

person has furnished the return or paid the tax, interest

or penalty, as the case may be;

(b) deduct from the refund due, any tax, interest,

penalty, fee or any other amount which the taxable

person is liable to pay but which remains unpaid under

this Act or under the existing law.

Explanation.––For the purposes of this sub-section, the

expression “specified date” shall mean the last date for

filing an appeal under this Act.

(11) Where an order giving rise to a refund is the

subject matter of an appeal or further proceedings

or where any other proceedings under this Act is

pending and the Commissioner is of the opinion

that grant of such refund is likely to adversely

affect the revenue in the said appeal or other

proceedings on account of malfeasance or fraud

committed, he may, after giving the taxable

person an opportunity of being heard, withhold

the refund till such time as he may determine.

(12) Where a refund is withheld under sub-section

(11), the taxable person shall, notwithstanding

anything contained in section 56, be entitled to

interest at such rate not exceeding six per cent. as

may be notified on the recommendations of the

Council, if as a result of the appeal or further

proceedings he becomes entitled to refund.

(13) Notwithstanding anything to the contrary

contained in this section, the amount of advance

82

tax deposited by a casual taxable person or a non-

resident taxable person under sub-section (2) of

section 27, shall not be refunded unless such

person has, in respect of the entire period for

which the certificate of registration granted to him

had remained in force, furnished all the returns

required under section 39.

(14) Notwithstanding anything contained in this

section, no refund under sub-section (5) or sub-

section (6) shall be paid to an applicant, if the

amount is less than one thousand rupees.

Explanation.—For the purposes of this section,––

(1) “refund” includes refund of tax paid on zero-

rated supplies of goods or services or both or on inputs

or input services used in making such zero-rated

supplies, or refund of tax on the supply of goods

regarded as deemed exports, or refund of unutilised

input tax credit as provided under sub-section (3).

(2) “relevant date” means –

(a) in the case of goods exported out of India

where a refund of tax paid is available in respect of

goods themselves or, as the case may be, the inputs

or input services used in such goods,––

(i) if the goods are exported by sea or air,

the date on which the ship or the aircraft in

which such goods are loaded, leaves India; or

(ii) if the goods are exported by land, the

date on which such goods pass the frontier; or

(iii) if the goods are exported by post, the

date of despatch of goods by the Post Office

concerned to a place outside India;

(b) in the case of supply of goods regarded as

deemed exports where a refund of tax paid is available

in respect of the goods, the date on which the return

relating to such deemed exports is furnished;

(c) in the case of services exported out of India

83

where a refund of tax paid is available in respect of

services themselves or, as the case may be, the inputs

or input services used in such services, the date of––

(i) receipt of payment in convertible foreign

exchange, where the supply of services had been

completed prior to the receipt of such payment; or

(ii) issue of invoice, where payment for the

services had been received in advance prior to the

date of issue of the invoice;

(d) in case where the tax becomes refundable as a

consequence of judgment, decree, order or direction of

the Appellate Authority, Appellate Tribunal or any

court, the date of communication of such judgment,

decree, order or direction;

(e) in the case of refund of unutilised input tax

credit under sub-section (3), the end of the financial

year in which such claim for refund arises;

(f) in the case where tax is paid provisionally under

this Act or the rules made there under, the date of

adjustment of tax after the final assessment thereof;

(g) in the case of a person, other than the supplier,

the date of receipt of goods or services or both by such

person; and

(h) in any other case, the date of payment of tax.

46 of 1947.

55. The Government may, on the recommendations of the

Council, by notification, specify any specialized

agency of the United Nations Organization or any

Multilateral Financial Institution and Organization

notified under the United Nations (Privileges and

Immunities) Act, 1947, Consulate or Embassy of

foreign countries and any other person or class of

persons as may be specified in this behalf, who shall,

subject to such conditions and restrictions as may be

prescribed, be entitled to claim a refund of taxes paid

on the notified supplies of goods or services or both

received by them.

Refund in certain

cases.

56. If any tax ordered to be refunded under sub-section (5)

of section 54 to any applicant is not refunded within

Interest on delayed

refunds.

84

sixty days from the date of receipt of application

under sub-section (1) of that section, interest at such

rate not exceeding six per cent. as may be specified in

the notification issued by the Government on the

recommendations of the Council shall be payable in

respect of such refund from the date immediately after

the expiry of sixty days from the date of receipt of

application under the said sub-section till the date of

refund of such tax:

Provided that where any claim of refund arises from

an order passed by an adjudicating authority or

Appellate Authority or Appellate Tribunal or court

which has attained finality and the same is not

refunded within sixty days from the date of receipt of

application filed consequent to such order, interest at

such rate not exceeding nine per cent. as may be

notified by the Government on the recommendations

of the Council shall be payable in respect of such

refund from the date immediately after the expiry of

sixty days from the date of receipt of application till

the date of refund.

Explanation.––For the purposes of this section, where

any order of refund is made by an Appellate Authority,

Appellate Tribunal or any court against an order of the

proper officer under sub-section (5) of section 54, the

order passed by the Appellate Authority, Appellate

Tribunal orby the court shall be deemed to be an order

passed under the said sub-section (5).

57. The Government shall constitute a Fund, to be called

the Consumer Welfare Fund and there shall be

credited to the Fund,––

Consumer Welfare

Fund.

(a) the amount referred to in sub-section (5) of

section 54;

(b) any income from investment of the amount

credited to the Fund; and

(c) such other

monies received by it,

in such manner as may be prescribed.

58. (1) All sums credited to the Fund shall be utilised by Utilisation of Fund.

85

the Government for the welfare of the consumers in

such manner as may be prescribed.

(2) The Government or the authority specified by it

shall maintain proper and separate account and

other relevant records in relation to the Fund and

prepare an annual statement of accounts in such

form as may be prescribed in consultation with the

Comptroller and Auditor General of India.

CHAPTER– XII

ASSESSMENT

59. Every registered person shall self-assess the taxes

payable under this Act and furnish a return for each

tax period as specified under section 39.

Self-assessment.

60. (1) Subject to the provisions of sub-section (2), where

the taxable person is unable to determine the value of

goods or services or both or determine the rate of tax

applicable thereto, he may request the proper officer

in writing giving reasons for payment of tax on a

provisional basis and the proper officer shall pass an

order, within a period not later than ninety days from

the date of receipt of such request, allowing payment

of tax on provisional basis at such rate or on such

value as may be specified by him.

Provisional

assessment.

(2) The payment of tax on provisional basis may be

allowed, if the taxable person executes a bond in such

form as may be prescribed, and with such surety or

security as the proper officer may deem fit, binding

the taxable person for payment of the difference

between the amount of tax as may be finally assessed

and the amount of tax provisionally assessed.

(3) The proper officer shall, within a period not exceeding

six months from the date of the communication of the

order issued under sub-section (1), pass the final

assessment order after taking into account such

information as may be required for finalizing the

assessment:

Provided that the period specified in this sub-section may,

86

on sufficient cause being shown and for reasons to be

recorded in writing, be extended by the Joint

Commissioner or Additional Commissioner for a further

period not exceeding six months and by the

Commissioner for such further period not exceeding four

years.

(4) The registered person shall be liable to pay interest on

any tax payable on the supply of goods or services or

both under provisional assessment but not paid on the

due date specified under sub-section (7) of section 39

or the rules made there under, at the rate specified

under sub-section (1) of section 50, from the first day

after the due date of payment of tax in respect of the

said supply of goods or services or both till the date of

actual payment, whether such amount is paid before or

after the issuance of order for final assessment.

(5) Where the registered person is entitled to a refund

consequent to the order of final assessment under sub-

section (3), subject to the provisions of sub-section (8)

of section 54, interest shall be paid on such refund as

provided in section 56.

61. (1) The proper officer may scrutinize the return and

related particulars furnished by the registered person

to verify the correctness of the return and inform him

of the discrepancies noticed, if any, in such manner as

may be prescribed and seek his explanation thereto.

Scrutiny of returns.

(2) In case the explanation is found acceptable, the

registered person shall be informed accordingly and

no further action shall be taken in this regard.

(3) In case no satisfactory explanation is furnished

within a period of thirty days of being informed by the

proper officer or such further period as may be

permitted by him or where the registered person, after

accepting the discrepancies, fails to take the corrective

measure in his return for the month in which the

discrepancy is accepted, the proper officer may

initiate appropriate action including those under

section 65or section 66 or section 67, or proceed to

determine the tax and other dues under section 73 or

section 74.

62. (1) Notwithstanding anything to the contrary

contained in section 73 or section 74, where a

Assessment of non-

filers of returns.

87

registered person fails to furnish the return under

section 39 or section 45, even after the service of a

notice under section 46, the proper officer may

proceed to assess the tax liability of the said person to

the best of his judgement taking into account all the

relevant material which is available or which he has

gathered and issue an assessment order within a

period of five years from the date specified under

section 44 for furnishing of the annual return for the

financial year to which the tax not paid relates.

(2) Where the registered person furnishes a valid return

within thirty days of the service of the assessment

order under sub-section (1), the said assessment order

shall be deemed to have been withdrawn but the

liability for payment of interest under sub-section (1)

of section 50 or for payment of late fee under section

47 shall continue.

63. Notwithstanding anything to the contrary contained in

section 73 or section 74,where a taxable person fails

to obtain registration even though liable to do so or

whose registration has been cancelled under sub-

section (2) of section 29 but who was liable to pay tax,

the proper officer may proceed to assess the tax

liability of such taxable person to the best of his

judgement for the relevant tax periods and issue an

assessment order within a period of five years from

the date specified under section 44 for furnishing of

the annual return for the financial year to which the

tax not paid relates:

Assessment of

unregistered persons.

Provided that no such assessment order shall be passed

without giving the person an opportunity of being heard.

64. (1) The proper officer may, on any evidence showing

a tax liability of a person coming to his notice, with

the previous permission of Additional Commissioner

or Joint Commissioner, proceed to assess the tax

liability of such person to protect the interest of

revenue and issue an assessment order, if he has

sufficient grounds to believe that any delay in doing

so may adversely affect the interest of revenue:

Summary assessment

in certain special

cases.

Provided that where the taxable person to whom

88

the liability pertains is not ascertainable and such liability

pertains to supply of goods, the person in charge of such

goods shall be deemed to be the taxable person liable to

be assessed and liable to pay tax and any other amount

due under this section.

(2) On an application made by the taxable person within

thirty days from the date of receipt of order passed

under sub-section (1) or on his own motion, if the

Additional Commissioner or Joint Commissioner

considers that such order is erroneous, he may

withdraw such order and follow the procedure laid

down in section 73 or section 74.

CHAPTER XIII

AUDIT

65. (1) The Commissioner or any officer authorised by

him, by way of a general or a specific order, may

undertake audit of any registered person for such

period, at such frequency and in such manner as may

be prescribed.

Audit by tax

authorities.

(2) The officers referred to in sub-section (1) may

conduct audit at the place of business of the

registered person or in their office.

(3) The registered person shall be informed by way of

a notice not less than fifteen working days prior to

the conduct of audit in such manner as may be

prescribed.

(4) The audit under sub-section (1) shall be completed

within a period of three months from the date of

commencement of the audit:

Provided that where the Commissioner is satisfied that

audit in respect of such registered person cannot be

completed within three months, he may, for the reasons to

be recorded in writing, extend the period by a further

period not exceeding six months.

Explanation.––For the purposes of this sub-section, the

expression “commencement of audit” shall mean the date

on which the records and other documents, called for by

89

the tax authorities, are made available by the registered

person or the actual institution of audit at the place of

business, whichever is later.

(5) During the course of audit, the authorised officer

may require the registered person,––

(i) to afford him the necessary facility to verify the

books of account or other documents as he may

require;

(ii) to furnish such information as he may require

and render assistance for timely completion of the

audit.

(6) On conclusion of audit, the proper officer shall,

within thirty days, inform the registered person,

whose records are audited, about the findings, his

rights and obligations and the reasons for such

findings.

(7) Where the audit conducted under sub-section (1)

results in detection of tax not paid or short paid or

erroneously refunded, or input tax credit wrongly

availed or utilised, the proper officer may initiate

action under section 73 or section 74.

66. (1) If at any stage of scrutiny, inquiry, investigation or

any other proceedings before him, any officer not

below the rank of Assistant Commissioner, having

regard to the nature and complexity of the case and

the interest of revenue, is of the opinion that the value

has not been correctly declared or the credit availed is

not within the normal limits, he may, with the prior

approval of the Commissioner, direct such registered

person by a communication in writing to get his

records including books of account examined and

audited by a chartered accountant or a cost accountant

as may be nominated by the Commissioner.

Special audit.

(2) The chartered accountant or cost accountant so

nominated shall, within the period of ninety days,

submit a report of such audit duly signed and

certified by him to the said Assistant

Commissioner mentioning therein such other

particulars as may be specified:

90

Provided that the Assistant Commissioner may, on an

application made to him in this behalf by the registered

person or the chartered accountant or cost accountant or

for any material and sufficient reason, extend the said

period by a further period of ninety days.

(3) The provisions of sub-section (1) shall have effect

notwithstanding that the accounts of the registered

person have been audited under any other

provisions of this Act or any other law for the

time being in force.

(4) The registered person shall be given an

opportunity of being heard in respect of any

material gathered on the basis of special audit

under sub-section (1) which is proposed to be

used in any proceedings against him under this

Act or the rules made there under.

(5) The expenses of the examination and audit of

records under sub-section (1), including the

remuneration of such chartered accountant or cost

accountant, shall be determined and paid by the

Commissioner and such determination shall be

final.

(6) Where the special audit conducted under sub-

section (1) results in detection of tax not paid or

short paid or erroneously refunded, or input tax

credit wrongly availed or utilised, the proper

officer may initiate action under section 73 or

section74.

CHAPTER XIV

INSPECTION, SEARCH, SEIZURE AND ARREST

67. (1) Where the proper officer, not below the rank of

Joint Commissioner, has reasons to believe that––

Power of inspection,

search and seizure.

(a) a taxable person has suppressed any transaction

relating to supply of goods or services or both or the

stock of goods in hand, or has claimed input tax credit

in excess of his entitlement under this Act or has

indulged in contravention of any of the provisions of

this Act or the rules made there under to evade tax

91

under this Act; or

(b) any person engaged in the business of

transporting goods or an owner or operator of a

warehouse or a godown or any other place is keeping

goods which have escaped payment of tax or has kept

his accounts or goods in such a manner as is likely to

cause evasion of tax payable under this Act,

he may authorise in writing any other officer of State tax

to inspect any places of business of the taxable person or

the persons engaged in the business of transporting goods

or the owner or the operator of warehouse or godown or

any other place.

(2) Where the proper officer, not below the rank of

Joint Commissioner, either pursuant to an

inspection carried out under sub-section (1) or

otherwise, has reasons to believe that any goods

liable to confiscation or any documents or books

or things, which in his opinion shall be useful for

or relevant to any proceedings under this Act, are

secreted in any place, he may authorise in writing

any other officer of State tax to search and seize

or may himself search and seize such goods,

documents or books or things:

Provided that where it is not practicable to seize any

such goods, the proper officer,or any officer authorised by

him, may serve on the owner or the custodian of the

goods an order that he shall not remove, part with, or

otherwise deal with the goods except with the previous

permission of such officer:

Provided further that the documents or books or things

so seized shall be retained by such officer only for so long

as may be necessary for their examination and for any

inquiry or proceedings under this Act.

(3) The documents, books or things referred to in sub-

section (2) or any other documents, books or

things produced by a taxable person or any other

person, which have not been relied upon for the

issue of notice under this Act or the rules made

there under, shall be returned to such person

within a period not exceeding thirty days of the

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issue of the said notice.

(4) The officer authorised under sub-section (2) shall

have the power to seal or break open the door of

any premises or to break open any almirah,

electronic devices, box, receptacle in which any

goods, accounts, registers or documents of the

person are suspected to be concealed, where

access to such premises, almirah, electronic

devices, box or receptacle is denied.

(5) The person from whose custody any documents

are seized under sub-section (2) shall be entitled

to make copies thereof or take extracts there from

in the presence of an authorised officer at such

place and time as such officer may indicate in this

behalf except where making such copies or taking

such extracts may, in the opinion of the proper

officer, prejudicially affect the investigation.

(6) The goods so seized under sub-section (2) shall be

released, on a provisional basis, upon execution of

a bond and furnishing of a security, in such

manner and of such quantum, respectively, as may

be prescribed or on payment of applicable tax,

interest and penalty payable, as the case may be.

(7) Where any goods are seized under sub-section (2)

and no notice in respect thereof is given within six

months of the seizure of the goods, the goods shall

be returned to the person from whose possession

they were seized:

Provided that the period of six months may, on

sufficient cause being shown, be extended by the proper

officer for a further period not exceeding six months.

(8) The Government may, having regard to the

perishable or hazardous nature of any goods,

depreciation in the value of the goods with the

passage of time, constraints of storage space for

the goods or any other relevant considerations, by

notification, specify the goods or class of goods

which shall, as soon as may be after its seizure

under sub-section (2), be disposed of by the

proper officer in such manner as may be

93

prescribed.

(9) Where any goods, being goods specified under

sub-section (8), have been seized by a proper

officer,or any officer authorised by him under

sub-section (2), he shall prepare an inventory of

such goods in such manner as may be prescribed.

2 of 1974. (10) The provisions of the Code of Criminal

Procedure, 1973, relating to search and seizure,

shall, so far as may be, apply to search and seizure

under this section subject to the modification that

sub-section (5) of section 165 of the said Code

shall have effect as if for the word “Magistrate”,

wherever it occurs, the word “Commissioner”

were substituted.

(11) Where the proper officer has reasons to believe

that any person has evaded or is attempting to

evade the payment of any tax, he may, for reasons

to be recorded in writing, seize the accounts,

registers or documents of such person produced

before him and shall grant a receipt for the same,

and shall retain the same for so long as may be

necessary in connection with any proceedings

under this Act orthe rules made there under for

prosecution.

(12) The Commissioner or an officer authorised by

him may cause purchase of any goods or services

or both by any person authorised by him from the

business premises of any taxable person, to check

the issue of tax invoices or bills of supply by such

taxable person, and on return of goods so

purchased by such officer, such taxable person or

any person in charge of the business premises

shall refund the amount so paid towards the goods

after cancelling any tax invoice or bill of supply

issued earlier.

68. (1) The Government may require the person in charge

of a conveyance carrying any consignment of goods

of value exceeding such amount as may be specified

to carry with him such documents and such devices as

may be prescribed.

Inspection of goods

in movement.

94

(2) The details of documents required to be carried

under sub-section (1) shall be validated in such

manner as may be prescribed.

(3) Where any conveyance referred to in sub-section

(1) is intercepted by the proper officer at any

place, he may require the person in charge of the

said conveyance to produce the documents

prescribed under the said sub-section and devices

for verification, and the said person shall be liable

to produce the documents and devices and also

allow the inspection of goods.

69. (1) Where the Commissioner has reasons to believe

that a person has committed any offence specified in

clause (a) or clause (b) or clause (c) or clause (d) of

sub-section (1) of section 132which is punishable

under clause (i) or (ii) of sub-section (1), or sub-

section (2) of the said section, he may, by order,

authorise any officer of State tax to arrest such

person.

Power to arrest.

(2) Where a person is arrested under sub-section (1)

for an offence specified under sub-section (5) of

section 132, the officer authorised to arrest the

person shall inform such person of the grounds of

arrest and produce him before a Magistrate within

twenty four hours.

2 of 1974.

(3) Subject to the provisions of the Code of Criminal

Procedure, 1973,--

(a) where a person is arrested under sub-section (1) for

any offence specified under sub-section (4) of section

132, he shall be admitted to bail or in default of bail,

forwarded to the custody of the Magistrate;

(b) in the case of a non-cognizable and bailable

offence, the Deputy Commissioner or the Assistant

Commissioner shall, for the purpose of releasing an

arrested person on bail or otherwise, have the same

powers and be subject to the same provisions as an

officer-in-charge of a police station

5 of 1908 70. (1) The proper officer under this Act shall have power

to summon any person whose attendance he considers

necessary either to give evidence or to produce a

document or any other thing in any inquiry in the

Power to summon

persons to give

evidence and produce

documents.

95

same manner, as provided in the case of a civil court

under the provisions of the Code of Civil Procedure,

1908.

45 of 1860.

(2) Every such inquiry referred to in sub-section (1)

shall be deemed to be a “judicial proceedings”

within the meaning of section 193 and section 228

of the Indian Penal Code.

71. (1) Any officer under this Act, authorised by the

proper officer not below the rank of Joint

Commissioner, shall have access to any place of

business of a registered person to inspect books of

account, documents, computers, computer programs,

computer software whether installed in a computer or

otherwise and such other things as he may require and

which may be available at such place, for the purposes

of carrying out any audit, scrutiny, verification and

checks as may be necessary to safeguard the interest

of revenue.

Access to business

premises.

(2) Every person in charge of place referred to in sub-

section (1) shall, on demand, make available to

the officer authorised under sub-section (1) or the

audit party deputed by the proper officer or a cost

accountant or chartered accountant nominated

under section 66––

(i) such records as prepared or maintained by the

registered person and declared to the proper officer in

such manner as may be prescribed;

(ii) trial balance or its equivalent;

(iii) statements of annual financial accounts, duly

audited, wherever required;

18 of 2013. (iv) cost audit report, if any, under section 148 of

the Companies Act, 2013;

43 of 1961.

(v) the income-tax audit report, if any, under

section 44AB of the Income-tax Act, 1961; and

(vi) any other relevant record,

96

for the scrutiny by the officer or audit party or the

chartered accountant or cost accountant within a period

not exceeding fifteen working days from the day when

such demand is made, or such further period as may be

allowed by the said officer or the audit party or the

chartered accountant or cost accountant.

72. (1) All officers of Police, Railways, Customs, and

those officers engaged in the collection of land

revenue, including village officers, officers of central

tax and officers of the Union territory tax shall assist

the proper officers in the implementation of this Act.

Officers to assist

proper officers.

(2) The Government may, by notification, empower

and require any other class of officers to assist the

proper officers in the implementation of this Act

when called upon to do so by the Commissioner.

CHAPTER XV

DEMANDS AND RECOVERY

73. (1) Where it appears to the proper officer that any tax

has not been paid or short paid or erroneously

refunded, or where input tax credit has been wrongly

availed or utilised for any reason, other than the

reason of fraud or any wilful misstatement or

suppression of facts to evade tax, he shall serve notice

on the person chargeable with tax which has not been

so paid or which has been so short paid or to whom

the refund has erroneously been made, or who has

wrongly availed or utilised input tax credit, requiring

him to show cause as to why he should not pay the

amount specified in the notice along with interest

payable thereon under section 50and a penalty

leviable under the provisions of this Act or the rules

made there under.

Determination of tax

not paid or short paid

or erroneously

refunded or input tax

credit wrongly

availed or utilised for

any reason other than

fraud or any wilful

misstatement or

suppression of facts.

(2) The proper officer shall issue the notice under

sub-section (1) at least three months prior to the

time limit specified in sub-section (10) for

issuance of order.

(3) Where a notice has been issued for any period

under sub-section (1), the proper officer may

serve a statement, containing the details of tax not

paid or short paid or erroneously refunded or input

97

tax credit wrongly availed or utilised for such

periods other than those covered under sub-

section (1), on the person chargeable with tax.

(4) The service of such statement shall be deemed to

be service of notice on such person under sub-

section (1), subject to the condition that the

grounds relied upon for such tax periods other

than those covered under sub-section (1) are the

same as are mentioned in the earlier notice.

(5) The person chargeable with tax may, before

service of notice under sub-section (1) or, as the

case may be, the statement under sub-section (3),

pay the amount of tax along with interest payable

thereon under section 50 on the basis of his own

ascertainment of such tax or the tax as ascertained

by the proper officer and inform the proper officer

in writing of such payment.

(6) The proper officer, on receipt of such information,

shall not serve any notice under sub-section (1) or,

as the case may be, the statement under sub-

section (3), in respect of the tax so paid or any

penalty payable under the provisions of this Act or

the rules made there under.

(7) Where the proper officer is of the opinion that the

amount paid under sub-section (5) falls short of

the amount actually payable, he shall proceed to

issue the notice as provided for in sub-section (1)

in respect of such amount which falls short of the

amount actually payable.

(8) Where any person chargeable with tax under sub-

section (1) or sub-section (3) pays the said tax

along with interest payable under section 50

within thirty days of issue of show cause notice,

no penalty shall be payable and all proceedings in

respect of the said notice shall be deemed to be

concluded.

(9) The proper officer shall, after considering the

representation, if any, made by person chargeable

with tax, determine the amount of tax, interest and

a penalty equivalent to ten per cent. of tax or ten

98

thousand rupees, whichever is higher, due from

such person and issue an order.

(10) The proper officer shall issue the order under

sub-section (9) within three years from the due

date for furnishing of annual return for the

financial year to which the tax not paid or short

paid or input tax credit wrongly availed or utilised

relates to or within three years from the date of

erroneous refund.

(11) Notwithstanding anything contained in sub-

section (6) or sub-section (8), penalty under sub-

section (9) shall be payable where any amount of

self-assessed tax or any amount collected as tax

has not been paid within a period of thirty days

from the due date of payment of such tax.

74. (1) Where it appears to the proper officer that any tax

has not been paid or short paid or erroneously

refunded or where input tax credit has been wrongly

availed or utilised by reason of fraud, or any wilful

misstatement or suppression of facts to evade tax, he

shall serve notice on the person chargeable with tax

which has not been so paid or which has been so short

paid or to whom the refund has erroneously been

made, or who has wrongly availed or utilised input tax

credit, requiring him to show cause as to why he

should not pay the amount specified in the notice

along with interest payable thereon under section 50

and a penalty equivalent to the tax specified in the

notice.

Determination of tax

not paid or short paid

or erroneously

refunded or input tax

credit wrongly

availed or utilised by

reason of fraud or any

wilful misstatement

or suppression of

facts.

(2) The proper officer shall issue the notice under

sub-section (1) at least six months prior to the

time limit specified in sub-section (10) for

issuance of order.

(3) Where a notice has been issued for any period

under sub-section (1), the proper officer may

serve a statement, containing the details of tax not

paid or short paid or erroneously refunded or input

tax credit wrongly availed or utilised for such

periods other than those covered under sub-

section (1), on the person chargeable with tax.

99

(4) The service of statement under sub-section (3)

shall be deemed to be service of notice under sub-

section (1) of section 73, subject to the condition

that the grounds relied upon in the said statement,

except the ground of fraud, or any wilful-

misstatement or suppression of facts to evade tax,

for periods other than those covered under sub-

section (1) are the same as are mentioned in the

earlier notice.

(5) The person chargeable with tax may, before

service of notice under sub-section (1), pay the

amount of tax along with interest payable under

section 50 and a penalty equivalent to fifteen per

cent. of such tax on the basis of his own

ascertainment of such tax or the tax as ascertained

by the proper officer and inform the proper officer

in writing of such payment.

(6) The proper officer, on receipt of such information,

shall not serve any notice under sub-section (1), in

respect of the tax so paid or any penalty payable

under the provisions of this Act or the rules made

there under.

(7) Where the proper officer is of the opinion that the

amount paid under sub-section (5) falls short of

the amount actually payable, he shall proceed to

issue the notice as provided for in sub-section (1)

in respect of such amount which falls short of the

amount actually payable.

(8) Where any person chargeable with tax under sub-

section (1)pays the said tax along with interest

payable under section 50 and a penalty equivalent

to twenty five per cent. of such tax within thirty

days of issue of the notice, all proceedings in

respect of the said notice shall be deemed to be

concluded.

(9) The proper officer shall, after considering the

representation, if any, made by the person

chargeable with tax, determine the amount of tax,

interest and penalty due from such person and

issue an order.

100

(10) The proper officer shall issue the order under

sub-section (9) within a period of five years from

the due date for furnishing of annual return for the

financial year to which the tax not paid or short

paid or input tax credit wrongly availed or utilised

relates to or within five years from the date of

erroneous refund.

(11) Where any person served with an order issued

under sub-section (9) pays the tax along with

interest payable thereon under section 50 and a

penalty equivalent to fifty per cent. of such tax

within thirty days of communication of the order,

all proceedings in respect of the said notice shall

be deemed to be concluded.

Explanation1.– For the purposes of section

73andthissection, —

(i) the expression “all proceedings in respect of the

said notice” shall not include proceedings under

section 132;

(ii)where the notice under the same proceedings is

issued to the main person liable to pay tax and some

other persons, and such proceedings against the main

person have been concluded under section 73 or

section 74, the proceedings against all the persons

liable to pay penalty under sections122, 125, 129 and

130 are deemed to be concluded.

Explanation 2.––For the purposes of this Act, the

expression “suppression” shall mean non-declaration of

facts or information which a taxable person is required to

declare in the return, statement, report or any other

document furnished under this Act or the rules made there

under, or failure to furnish any information on being

asked for, in writing, by the proper officer.

75. (1) Where the service of notice or issuance of order is

stayed by an order of a court or Appellate Tribunal,

the period of such stay shall be excluded in computing

the period specified in sub-sections (2) and (10) of

section 73 or sub-sections (2) and (10) of section 74,

as the case may be.

General provisions

relating to

determination of tax.

101

(2) Where any Appellate Authority or Appellate

Tribunal or court concludes that the notice issued

under sub-section (1) of section 74 is not

sustainable for the reason that the charges of fraud

or any wilful misstatement or suppression of facts

to evade tax has not been established against the

person to whom the notice was issued, the proper

officer shall determine the tax payable by such

person, deeming as if the notice were issued under

sub-section (1) of section 73.

(3) Where any order is required to be issued in

pursuance of the direction of the Appellate

Authority or Appellate Tribunal or a court, such

order shall be issued within two years from the

date of communication of the said direction.

(4) An opportunity of hearing shall be granted where

a request is received in writing from the person

chargeable with tax or penalty, or where any

adverse decision is contemplated against such

person.

(5) The proper officer shall, if sufficient cause is

shown by the person chargeable with tax, grant

time to the said person and adjourn the hearing for

reasons to be recorded in writing:

Provided that no such adjournment shall be granted for

more than three times to a person during the proceedings.

(6) The proper officer, in his order, shall set out the

relevant facts and the basis of his decision.

(7) The amount of tax, interest and penalty demanded

in the order shall not be in excess of the amount

specified in the notice and no demand shall be

confirmed on the grounds other than the grounds

specified in the notice.

(8) Where the Appellate Authority or Appellate

Tribunal or court modifies the amount of tax

determined by the proper officer, the amount of

interest and penalty shall stand modified

accordingly, taking into account the amount of tax

102

so modified.

(9) The interest on the tax short paid or not paid shall

be payable whether or not specified in the order

determining the tax liability.

(10) The adjudication proceedings shall be deemed

to be concluded, if the order is not issued within

three years as provided for in sub-section (10) of

section 73 or within five years as provided for in

sub-section (10) of section 74.

(11) An issue on which the Appellate Authority or

the Appellate Tribunal or the High Court has

given its decision which is prejudicial to the

interest of revenue in some other proceedings and

an appeal to the Appellate Tribunal or the High

Court or the Supreme Court against such decision

of the Appellate Authority or the Appellate

Tribunal or the High Court is pending, the period

spent between the date of the decision of the

Appellate Authority and that of the Appellate

Tribunal or the date of decision of the Appellate

Tribunal and that of the High Court or the date of

the decision of the High Court and that of the

Supreme Court shall be excluded in computing the

period referred to in sub-section (10) of section 73

or sub-section (10) of section 74 where

proceedings are initiated by way of issue of a

show cause notice under the said sections.

(12) Notwithstanding anything contained in section

73 or section74, where any amount of self-

assessed tax in accordance with a return furnished

under section 39 remains unpaid, either wholly or

partly, or any amount of interest payable on such

tax remains unpaid, the same shall be recovered

under the provisions of section 79.

(13) Where any penalty is imposed under section

73 or section 74, no penalty for the same act or

omission shall be imposed on the same person

under any other provision of this Act.

76. (1) Notwithstanding anything to the contrary

contained in any order or direction of any Appellate

Tax collected but not

paid to Government.

103

Authority or Appellate Tribunal or court or in any

other provisions of this Act or the rules made there

under or any other law for the time being in force,

every person who has collected from any other person

any amount as representing the tax under this Act, and

has not paid the said amount to the Government, shall

forthwith pay the said amount to the Government,

irrespective of whether the supplies in respect of

which such amount was collected are taxable or not.

(2) Where any amount is required to be paid to the

Government under sub-section (1), and which has

not been so paid, the proper officer may serve on

the person liable to pay such amount a notice

requiring him to show cause as to why the said

amount as specified in the notice, should not be

paid by him to the Government and why a penalty

equivalent to the amount specified in the notice

should not be imposed on him under the

provisions of this Act.

(3) The proper officer shall, after considering the

representation, if any, made by the person on

whom the notice is served under sub-section (2),

determine the amount due from such person and

thereupon such person shall pay the amount so

determined.

(4) The person referred to in sub-section (1) shall in

addition to paying the amount referred to in sub-

section (1) or sub-section (3) also be liable to pay

interest thereon at the rate specified under section

50 from the date such amount was collected by

him to the date such amount is paid by him to the

Government.

(5) An opportunity of hearing shall be granted where

a request is received in writing from the person to

whom the notice was issued to show cause.

(6) The proper officer shall issue an order within one

year from the date of issue of the notice.

(7) Where the issuance of order is stayed by an order

of the court or Appellate Tribunal, the period of

such stay shall be excluded in computing the

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period of one year.

(8) The proper officer, in his order, shall set out the

relevant facts and the basis of his decision.

(9) The amount paid to the Government under sub-

section (1) or sub-section (3) shall be adjusted

against the tax payable, if any, by the person in

relation to the supplies referred to in sub-section

(1).

(10) Where any surplus is left after the adjustment

under sub-section (9), the amount of such surplus

shall either be credited to the Fund or refunded to

the person who has borne the incidence of such

amount.

(11) The person who has borne the incidence of the

amount, may apply for the refund of the same in

accordance with the provisions of section 54.

77. (1) A registered person who has paid the central tax

and State tax on a transaction considered by him to be

an intra-State supply, but which is subsequently held

to be an inter-State supply, shall be refunded the

amount of taxes so paid in such manner and subject to

such conditions as may be prescribed.

Tax wrongfully

collected and paid to

Central Government

or State Government.

(2) A registered person who has paid integrated tax

on a transaction considered by him to be an inter-

State supply, but which is subsequently held to be

an intra-State supply, shall not be required to pay

any interest on the amount of State tax payable.

78. Any amount payable by a taxable person in pursuance

of an order passed under this Act shall be paid by such

person within a period of three months from the date

of service of such order failing which recovery

proceedings shall be initiated:

Initiation of recovery

proceedings.

Provided that where the proper officer considers it

expedient in the interest of revenue, he may, for reasons

to be recorded in writing, require the said taxable person

to make such payment within such period less than a

period of three months as may be specified by him.

105

79. (1) Where any amount payable by a person to the

Government under any of the provisions of this Act or

the rules made there under is not paid, the proper

officer shall proceed to recover the amount by one or

more of the following modes, namely:––

Recovery of tax.

(a) the proper officer may deduct or may require

any other specified officer to deduct the amount so

payable from any money owing to such person which

may be under the control of the proper officer or such

other specified officer;

(b) the proper officer may recover or may require

any other specified officer to recover the amount so

payable by detaining and selling any goods belonging

to such person which are under the control of the

proper officer or such other specified officer;

(c) (i) the proper officer may, by a notice in writing,

require any other person from whom money is due or

may become due to such person or who holds or may

subsequently hold money for or on account of such

person, to pay to the Government either forthwith

upon the money becoming due or being held, or within

the time specified in the notice not being before the

money becomes due or is held, so much of the money

as is sufficient to pay the amount due from such

person or the whole of the money when it is equal to

or less than that amount;

(ii) every person to whom the notice is issued

under sub-clause (i) shall be bound to comply with

such notice, and in particular, where any such

notice is issued to a post office, banking company

or an insurer, it shall not be necessary to produce

any pass book, deposit receipt, policy or any other

document for the purpose of any entry,

endorsement or the like being made before

payment is made, notwithstanding any rule,

practice or requirement to the contrary;

(iii) in case the person to whom a notice under

sub-clause (i) has been issued, fails to make the

payment in pursuance thereof to the Government,

he shall be deemed to be a defaulter in respect of

the amount specified in the notice and all the

106

consequences of this Act or the rules made there

under shall follow;

(iv) the officer issuing a notice under sub-

clause (i) may, at any time, amend or revoke such

notice or extend the time for making any payment

in pursuance of the notice;

(v) any person making any payment in

compliance with a notice issued under sub-clause

(i) shall be deemed to have made the payment

under the authority of the person in default and

such payment being credited to the Government

shall be deemed to constitute a good and sufficient

discharge of the liability of such person to the

person in default to the extent of the amount

specified in the receipt;

(vi) any person discharging any liability to the

person in default after service on him of the notice

issued under sub-clause (i) shall be personally

liable to the Government to the extent of the

liability discharged or to the extent of the liability

of the person in default for tax, interest and

penalty, whichever is less;

(vii) where a person on whom a notice is served

under sub-clause (i) proves to the satisfaction of the

officer issuing the notice that the money demanded

or any part thereof was not due to the person in

default or that he did not hold any money for or on

account of the person in default, at the time the

notice was served on him, nor is the money

demanded or any part thereof, likely to become due

to the said person or be held for or on account of

such person, nothing contained in this section shall

be deemed to require the person on whom the

notice has been served to pay to the Government

any such money or part thereof;

(d) the proper officer may, in accordance with the

rules to be made in this behalf, distrain any movable or

immovable property belonging to or under the control

of such person, and detain the same until the amount

payable is paid; and in case, any part of the said

amount payable or of the cost of the distress or keeping

107

of the property, remains unpaid for a period of thirty

days next after any such distress, may cause the said

property to be sold and with the proceeds of such sale,

may satisfy the amount payable and the costs including

cost of sale remaining unpaid and shall render the

surplus amount, if any, to such person;

(e) the proper officer may prepare a certificate

signed by him specifying the amount due from such

person and send it to the Collector of the district in

which such person owns any property or resides or

carries on his business or to any officer authorised by

the Government and the said Collector or the said

officer, on receipt of such certificate, shall proceed to

recover from such person the amount specified there

under as if it were an arrear of land revenue;

2 of 1974.

(f) Notwithstanding anything contained in the Code

of Criminal Procedure, 1973, the proper officer may

file an application to the appropriate Magistrate and

such Magistrate shall proceed to recover from such

person the amount specified there under as if it were a

fine imposed by him.

(2) Where the terms of any bond or other instrument

executed under this Act or any rules or regulations

made there under provide that any amount due

under such instrument may be recovered in the

manner laid down in sub-section (1), the amount

may, without prejudice to any other mode of

recovery, be recovered in accordance with the

provisions of that sub-section.

(3) Where any amount of tax, interest or penalty is

payable by a person to the Government under any

of the provisions of this Act or the rules made

there under and which remains unpaid, the proper

officer of central tax, during the course of

recovery of said tax arrears, may recover the

amount from the said person as if it were an arrear

of central tax and credit the amount so recovered

to the account of the Government.

(4) Where the amount recovered under sub-section

(3) is less than the amount due to the Central

Government and State Government, the amount to

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be credited to the account of the respective

Governments shall be in proportion to the amount

due to each such Government.

80. On an application filed by a taxable person, the

Commissioner may, for reasons to be recorded in

writing, extend the time for payment or allow payment

of any amount due under this Act, other than the

amount due as per the liability self-assessed in any

return, by such person in monthly instalments not

exceeding twenty four, subject to payment of interest

under section 50and subject to such conditions and

limitations as may be prescribed:

Payment of tax and

other amount in

instalments.

Provided that where there is default in payment of any

one instalment on its due date, the whole outstanding

balance payable on such date shall become due and

payable forthwith and shall, without any further notice

being served on the person, be liable for recovery.

81. Where a person, after any amount has become due

from him, creates a charge on or parts with the

property belonging to him or in his possession by way

of sale, mortgage, exchange, or any other mode of

transfer whatsoever of any of his properties in favour

of any other person with the intention of defrauding

the Government revenue, such charge or transfer shall

be void as against any claim in respect of any tax or

any other sum payable by the said person:

Transfer of property

to be void in certain

cases.

Provided that, such charge or transfer shall not be void

if it is made for adequate consideration, in good faith and

without notice of the pendency of such proceedings under

this Act or without notice of such tax or other sum

payable by the said person, or with the previous

permission of the proper officer.

31 of 2016

82. Notwithstanding anything to the contrary contained in

any law for the time being in force, save as otherwise

provided in the Insolvency and Bankruptcy Code,

2016, any amount payable by a taxable person or any

other person on account of tax, interest or penalty

which he is liable to pay to the Government shall be a

first charge on the property of such taxable person or

such person.

Tax to be first charge

on property.

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83. (1) Where during the pendency of any proceedings

under section62 or section 63 or section 64 or section

67 or section 73 or section 74, the Commissioner is of

the opinion that for the purpose of protecting the

interest of the Government revenue, it is necessary so

to do, he may, by order in writing attach provisionally

any property, including bank account, belonging to the

taxable person in such manner as may be prescribed.

Provisional

attachment to protect

revenue in certain

cases.

(2) Every such provisional attachment shall cease to

have effect after the expiry of a period of one year

from the date of the order made under sub-section

(1).

84. Where any notice of demand in respect of any tax,

penalty, interest or any other amount payable under

this Act, (hereafter in this section referred to as

“Government dues”), is served upon any taxable

person or any other person and any appeal or revision

application is filed or any other proceedings is

initiated in respect of such Government dues, then––

Continuation and

validation of certain

recovery proceedings.

(a) where such Government dues are enhanced in

such appeal, revision or other proceedings, the

Commissioner shall serve upon the taxable person or

any other person another notice of demand in respect

of the amount by which such Government dues are

enhanced and any recovery proceedings in relation to

such Government dues as are covered by the notice of

demand served upon him before the disposal of such

appeal, revision or other proceedings may, without the

service of any fresh notice of demand, be continued

from the stage at which such proceedings stood

immediately before such disposal;

(b) where such Government dues are reduced in

such appeal, revision or in other proceedings––

(i) it shall not be necessary for the

Commissioner to serve upon the taxable person a

fresh notice of demand;

(ii) the Commissioner shall give intimation of

such reduction to him and to the appropriate

authority with whom recovery proceedings is

pending;

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(iii) any recovery proceedings initiated on the

basis of the demand served upon him prior to the

disposal of such appeal, revision or other

proceedings may be continued in relation to the

amount so reduced from the stage at which such

proceedings stood immediately before such

disposal.

CHAPTER XVI

LIABILITY TO PAY IN CERTAIN CASES

85. (1) Where a taxable person, liable to pay tax under

this Act, transfers his business in whole or in part, by

sale, gift, lease, leave and license, hire or in any other

manner whatsoever, the taxable person and the person

to whom the business is so transferred shall, jointly

and severally, be liable wholly orto the extent of such

transfer, to pay the tax, interest or any penalty due

from the taxable person upto the time of such transfer,

whether such tax, interest or penalty has been

determined before such transfer, but has remained

unpaid or is determined thereafter.

Liability in case of

transfer of business.

(2) Where the transferee of a business referred to in

sub-section (1) carries on such business either in

his own name or in some other name, he shall be

liable to pay tax on the supply of goods or

services or both effected by him with effect from

the date of such transfer and shall, if he is a

registered person under this Act, apply within the

prescribed time for amendment of his certificate

of registration.

86. Where an agent supplies or receives any taxable goods

on behalf of his principal, such agent and his principal

shall, jointly and severally, be liable to pay the tax

payable on such goods under this Act.

Liability of agent and

principal.

87. (1) When two or more companies are amalgamated or

merged in pursuance of an order of court or of

Tribunal or otherwise and the order is to take effect

from a date earlier to the date of the order and any two

or more of such companies have supplied or received

any goods or services or both to or from each other

Liability in case of

amalgamation or

merger of companies.

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during the period commencing on the date from which

the order takes effect till the date of the order, then

such transactions of supply and receipt shall be

included in the turnover of supply or receipt of the

respective companies and they shall be liable to pay

tax accordingly.

(2) Notwithstanding anything contained in the said

order, for the purposes of this Act, the said two or

more companies shall be treated as distinct

companies for the period up to the date of the said

order and the registration certificates of the said

companies shall be cancelled with effect from the

date of the said order.

31 of 2016 88. (1) When any company is being wound up whether

under the orders of a court or Tribunal or otherwise,

every person appointed as receiver of any assets of a

company (hereafter in this section referred to as the

“liquidator”), shall, within thirty days after his

appointment, give intimation of his appointment to the

Commissioner.

Liability in case of

company in

liquidation.

(2) The Commissioner shall, after making such

inquiry or calling for such information as he may

deem fit, notify the liquidator within three months

from the date on which he receives intimation of

the appointment of the liquidator, the amount

which in the opinion of the Commissioner would

be sufficient to provide for any tax, interest or

penalty which is then, or is likely thereafter to

become, payable by the company.

(3) When any private company is wound up and any

tax, interest or penalty determined under this Act

on the company for any period, whether before or

in the course of or after its liquidation, cannot be

recovered, then every person who was a director

of such company at any time during the period for

which the tax was due shall, jointly and severally,

be liable for the payment of such tax, interest or

penalty, unless he proves to the satisfaction of the

Commissioner that such non-recovery cannot be

attributed to any gross neglect, misfeasance or

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breach of duty on his part in relation to the affairs

of the company.

18 of 2013. 89. (1) Notwithstanding anything contained in the

Companies Act, 2013, where any tax, interest or

penalty due from a private company in respect of any

supply of goods or services or both for any period

cannot be recovered, then, every person who was a

director of the private company during such period

shall, jointly and severally, be liable for the payment

of such tax, interest or penalty unless he proves that

the non-recovery cannot be attributed to any gross

neglect, misfeasance or breach of duty on his part in

relation to the affairs of the company.

Liability of directors

of private company.

(2) Where a private company is converted into a

public company and the tax, interest or penalty in

respect of any supply of goods or services or both

for any period during which such company was a

private company cannot be recovered before such

conversion, then, nothing contained in sub-section

(1) shall apply to any person who was a director

of such private company in relation to any tax,

interest or penalty in respect of such supply of

goods or services or both of such private

company:

Provided that nothing contained in this sub-section

shall apply to any personal penalty imposed on such

director.

90. Notwithstanding any contract to the contrary and any

other law for the time being in force, where any firm

is liable to pay any tax, interest or penalty under this

Act, the firm and each of the partners of the firm shall,

jointly and severally, be liable for such payment:

Liability of partners

of firm to pay tax.

Provided that where any partner retires from the firm,

he or the firm, shall intimate the date of retirement of the

said partner to the Commissioner by a notice in that

behalf in writing and such partner shall be liable to pay

tax, interest or penalty due upto the date of his retirement

whether determined or not, on that date:

Provided further that if no such intimation is given

within one month from the date of retirement, the liability

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of such partner under the first proviso shall continue until

the date on which such intimation is received by the

Commissioner.

91. Where the business in respect of which any tax,

interest or penalty is payable under this Act is carried

on by any guardian, trustee or agent of a minor or

other incapacitated person on behalf of and for the

benefit of such minor or other incapacitated person,

the tax, interest or penalty shall be levied upon and

recoverable from such guardian, trustee or agent in

like manner and to the same extent as it would be

determined and recoverable from any such minor or

other incapacitated person, as if he were a major or

capacitated person and as if he were conducting the

business himself, and all the provisions of this Act or

the rules made there under shall apply accordingly.

Liability of

guardians, trustees

etc.

92. Where the estate or any portion of the estate of a

taxable person owning a business in respect of which

any tax, interest or penalty is payable under this Act is

under the control of the Court of Wards, the

Administrator General, the Official Trustee or any

receiver or manager (including any person, whatever

be his designation, who in fact manages the business)

appointed by or under any order of a court, the tax,

interest or penalty shall be levied upon and be

recoverable from such Court of Wards, Administrator

General, Official Trustee, receiver or manager in like

manner and to the same extent as it would be

determined and be recoverable from the taxable

person as if he were conducting the business himself,

and all the provisions of this Act or the rules made

there under shall apply accordingly.

Liability of Court of

Wards, etc.

31 of 2016 93. (1) Save as otherwise provided in the Insolvency and

Bankruptcy Code, 2016,where a person, liable to pay

tax, interest or penalty under this Act, dies, then––

Special provisions

regarding liability to

pay tax, interest or

penalty in certain

cases.

(a) if a business carried on by the person is

continued after his death by his legal representative or

any other person, such legal representative or other

person, shall be liable to pay tax, interest or penalty

due from such person under this Act; and

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(b) if the business carried on by the person is

discontinued, whether before or after his death, his

legal representative shall be liable to pay, out of the

estate of the deceased, to the extent to which the estate

is capable of meeting the charge, the tax, interest or

penalty due from such person under this Act,

whether such tax, interest or penalty has been determined

before his death but has remained unpaid or is determined

after his death.

31 of 2016 (2) Save as otherwise provided in the Insolvency and

Bankruptcy Code, 2016, where a taxable person,

liable to pay tax, interest or penalty under this Act,

is a Hindu Undivided Family or an association of

persons and the property of the Hindu Undivided

Family or the association of persons is partitioned

amongst the various members or groups of

members, then, each member or group of

members shall, jointly and severally, be liable to

pay the tax, interest or penalty due from the

taxable person under this Act upto the time of the

partition whether such tax, penalty or interest has

been determined before partition but has remained

unpaid or is determined after the partition.

31 of 2016 (3) Save as otherwise provided in the Insolvency and

Bankruptcy Code, 2016, where a taxable person,

liable to pay tax, interest or penalty under this Act,

is a firm, and the firm is dissolved, then, every

person who was a partner shall, jointly and

severally, be liable to pay the tax, interest or

penalty due from the firm under this Act upto the

time of dissolution whether such tax, interest or

penalty has been determined before the

dissolution, but has remained unpaid or is

determined after dissolution.

31 of 2016 (4) Save as otherwise provided in the Insolvency and

Bankruptcy Code, 2016, where a taxable person

liable to pay tax, interest or penalty under this

Act,––

(a) is the guardian of a ward on whose behalf the

business is carried on by the guardian; or

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(b) is a trustee who carries on the business under a

trust for a beneficiary,

then, if the guardianship or trust is terminated, the ward or

the beneficiary shall be liable to pay the tax, interest or

penalty due from the taxable person upto the time of the

termination of the guardianship or trust, whether such tax,

interest or penalty has been determined before the

termination of guardianship or trust but has remained

unpaid or is determined thereafter.

94. (1) Where a taxable person is a firm or an association

of persons or a Hindu Undivided Family and such

firm, association or family has discontinued business–

–

Liability in other

cases.

(a) the tax, interest or penalty payable under this

Act by such firm, association or family upto the date of

such discontinuance may be determined as if no such

discontinuance had taken place; and

(b) every person who, at the time of such

discontinuance, was a partner of such firm, or a

member of such association or family, shall,

notwithstanding such discontinuance, jointly and

severally, be liable for the payment of tax and interest

determined and penalty imposed and payable by such

firm, association or family, whether such tax and

interest has been determined or penalty imposed prior

to or after such discontinuance and subject as

aforesaid, the provisions of this Act shall, so far as

may be, apply as if every such person or partner or

member were himself a taxable person.

(2) Where a change has occurred in the constitution

of a firm or an association of persons, the partners

of the firm or members of association, as it existed

before and as it exists after the reconstitution,

shall, without prejudice to the provisions of

section 90, jointly and severally, be liable to pay

tax, interest or penalty due from such firm or

association for any period before its

reconstitution.

(3) The provisions of sub-section (1) shall, so far as

may be, apply where the taxable person, being a

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firm or association of persons is dissolved or

where the taxable person, being a Hindu

Undivided Family, has effected partition with

respect to the business carried on by it and

accordingly references in that sub-section to

discontinuance shall be construed as reference to

dissolution or to partition.

Explanation.––For the purposes of this Chapter,––

6of 2009.

(i) a “Limited Liability Partnership” formed and

registered under the provisions of the Limited Liability

Partnership Act, 2008shall also be considered as a

firm;

(ii) “court” means the District Court, High Court or

Supreme Court.

CHAPTER XVII

ADVANCE RULING

95. In this Chapter, unless the context otherwise

requires,––

Definitions.

(a) “advance ruling” means a decision provided by

the Authority or the Appellate Authority to an

applicant on matters or on questions specified in sub-

section (2) of section 97 or sub-section (1) of section

100, in relation to the supply of goods or services or

both being undertaken or proposed to be undertaken by

the applicant;

(b) "Appellate

Authority" means the Appellate Authority for

Advance Ruling constituted under section 99;

(c) “applicant” means any person registered or

desirous of obtaining registration under this Act;

(d) “application” means an application made to the

Authority under sub-section (1) of section 97;

(e) “Authority” means the Authority for Advance

Ruling, constituted under section 96.

117

96. (1) The Government shall, by notification, constitute

an Authority to be known as the Uttar Pradesh

Authority for Advance Ruling:

Constitution of

Authority for

Advance Ruling.

Provided that the Government may, on the

recommendation of the Council, notify any Authority

located in another State to act as the Authority for

the State.

(2) The Authority shall consist of-

(i) one member from amongst the officers of central

tax; and

(ii) one member from amongst the officers of State

tax,

to be appointed by the Central Government and the State

Government respectively.

(3) The qualifications, the method of appointment of the

members and the terms and conditions of their services

shall be such as may be prescribed.

97. (1) An applicant desirous of obtaining an advance

ruling under this Chapter may make an application in

such form and manner and accompanied by such fee

as may be prescribed, stating the question on which

the advance ruling is sought.

Application for

advance ruling.

(2) The question on which the advance ruling is

sought under this Act, shall be in respect of, -

(a) classification of any goods or services or both;

(b) applicability of a notification issued under the

provisions of this Act;

(c) determination of time and value of supply of

goods or services or both;

(d) admissibility of input tax credit of tax paid or

deemed to have been paid;

(e) determination of the liability to pay tax on any

118

goods or services or both;

(f) whether applicant is required to be registered;

(g) whether any particular thing done by the

applicant with respect to any goods or services or both

amounts to or results in a supply of goods or services

or both, within the meaning of that term.

98. (1) On receipt of an application, the Authority shall

cause a copy thereof to be forwarded tothe concerned

officer and, if necessary, call upon him to furnish the

relevant records:

Procedure on receipt

of application.

Provided that where any records have been called for

by the Authority in any case, such records shall, as soon

as possible, be returned to the said concerned officer.

(2) The Authority may, after examining the

application and the records called for and after

hearing the applicant or his authorised

representative and the concerned officer or his

authorised representative, by order, either admit or

reject the application:

Provided that the Authority shall not admit the application

where the question raised in the application is already

pending or decided in any proceedings in the case of an

applicant under any of the provisions of this Act:

Provided further that no application shall be

rejected under this sub-section unless an opportunity of

hearing has been given to the applicant:

Provided also that where the application is rejected,

the reasons for such rejection shall be specified in the

order.

(3) A copy of every order made under sub-section (2)

shall be sent to the applicant and to the concerned

officer.

(4) Where an application is admitted under sub-

section (2), the Authority shall, after examining

such further material as may be placed before it by

the applicant or obtained by the Authority and

119

after providing an opportunity of being heard to

the applicant or his authorised representative as

well as to the concerned officer or his authorised

representative, pronounce its advance ruling on

the question specified in the application.

(5) Where the members of the Authority differ on any

question on which the advance ruling is sought,

they shall state the point or points on which they

differ and make a reference to the Appellate

Authority for hearing and decision on such

question.

(6) The Authority shall pronounce its advance ruling

in writing within ninety days from the date of

receipt of application.

(7) A copy of the advance ruling pronounced by the

Authority duly signed by the members and

certified in such manner as may be prescribed

shall be sent to the applicant, the concerned

officer and the jurisdictional officer after such

pronouncement.

99. (1) The Government shall, by notification, constitute

an Authority to be known as Uttar Pradesh

Appellate Authority for Advance Ruling for Goods

and Services Tax for hearing appeals against the

advance ruling pronounced by the Advance Ruling

Authority: consisting of-

(i) the Chief Commissioner of Central Tax as

designated by the Board, and

(ii)the Commissioner of state tax

Constitution of

Appellate Authority

for Advance Ruling.

Provided that the Government may, on the

recommendations of the Council, notify any

Appellate Authority located in another State or

Union territory to act as the Appellate Authority for

the State.

.

100. (1) The concerned officer, the jurisdictional officer

or an applicant aggrieved by any advance ruling

Appeal to the

Appellate Authority.

120

pronounced under sub-section (4) of section 98, may

appeal to the Appellate Authority.

(2) Every appeal under this section shall be filed

within a period of thirty days from the date on

which the ruling sought to be appealed against is

communicated to the concerned officer, the

jurisdictional officer and the applicant:

Provided that the Appellate Authority may, if it is

satisfied that the appellant was prevented by a sufficient

cause from presenting the appeal within the said period of

thirty days, allow it to be presented within a further period

not exceeding thirty days.

(3) Every appeal under this section shall be in such

form, accompanied by such fee and verified in

such manner as may be prescribed.

101. (1) The Appellate Authority may, after giving the

parties to the appeal or reference an opportunity of

being heard, pass such order as it thinks fit,

confirming or modifying the ruling appealed against

or referred to.

Orders of Appellate

Authority.

(2) The order referred to in sub-section (1) shall be

passed within a period of ninety days from the

date of filing of the appeal under section 100 or a

reference under sub-section (5) of section 98.

(3) Where the members of the Appellate Authority

differ on any point or points referred to in appeal

or reference, it shall be deemed that no advance

ruling can be issued in respect of the question

under the appeal or reference.

(4) A copy of the advance ruling pronounced by the

Appellate Authority duly signed by the Members

and certified in such manner as may be prescribed

shall be sent to the applicant, the concerned

officer, the jurisdictional officer and to the

Authority after such pronouncement.

102. The Authority or the Appellate Authority may

amend any order passed by it under section 98 or

section 101, so as to rectify any error apparent on the

Rectification of

advance ruling.

121

face of the record, if such error is noticed by the

Authority or the Appellate Authority on its own

accord, or is brought to its notice by the concerned

officer, the jurisdictional officer, or the applicant or

the appellant within a period of six months from the

date of the order:

Provided that no rectification which has the effect of

enhancing the tax liability or reducing the amount of

admissible input tax credit shall be made unless the

applicant or the appellant has been given an opportunity

of being heard.

103. (1) The advance ruling pronounced by the

Authority or the Appellate Authority under this

Chapter shall be binding only -

Applicability of

advance ruling.

(a) on the applicant who had sought it in respect of

any matter referred to in sub-section (2) of section 97

for advance ruling;

(b) on the concerned officer or the jurisdictional

officer in respect of the applicant.

(2) The advance ruling referred to in sub-section (1)

shall be binding unless the law, facts or

circumstances supporting the original advance

ruling have changed.

104. (1) Where the Authority or the Appellate

Authority finds that advance ruling pronounced by it

under sub-section (4) of section 98or under sub-

section (1) of section 101has been obtained by the

applicant or the appellant by fraud or suppression of

material facts or misrepresentation of facts, it may, by

order, declare such ruling to be voidab-initio and

thereupon all the provisions of this Act or the rules

made there under shall apply to the applicant or the

appellant as if such advance ruling had never been

made:

Advance ruling to be

void in certain

circumstances.

Provided that no order shall be passed under this sub-

section unless an opportunity of being heard has been

given to the applicant or the appellant.

Explanation.––The period beginning with the date of

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such advance ruling and ending with the date of order

under this sub-section shall be excluded while computing

the period specified in sub-sections (2) and (10) of section

73 or sub-sections (2) and (10) of section 74.

(2) A copy of the order made under sub-section (1)

shall be sent to the applicant, the concerned

officer and the jurisdictional officer.

5 of 1908.

105. (1) The Authority or the Appellate Authority shall,

for the purpose of exercising its powers regarding –

(a) discovery and inspection;

(b) enforcing the attendance of any person and

examining him on oath;

(c) issuing commissions and compelling production

of books of account and other records,

have all the powers of a civil court under the Code of

Civil Procedure, 1908.

Powers of Authority

and Appellate

Authority.

2 of 1974.

45 of 1860.

(2) The Authority or the Appellate Authority shall be

deemed to be a civil court for the purposes of

section 195, but not for the purposes of Chapter

XXVI of the Code of Criminal Procedure, 1973,

and every proceeding before the Authority or the

Appellate Authority shall be deemed to be a

judicial proceedings within the meaning of

sections 193 and 228, and for the purpose of

section 196 of the Indian Penal Code.

106. The Authority or the Appellate Authority shall,

subject to the provisions of this Chapter, have power

to regulate its own procedure.

Procedure of

Authority and

Appellate Authority.

CHAPTER–XVIII

APPEALS AND REVISION

107. (1) Any person aggrieved by any decision or order

passed under this Act or the Central Goods and

Services Tax Act by an adjudicating authority may

appeal to such Appellate Authority as may be

prescribed within three months from the date on

which the said decision or order is communicated to

such person.

Appeals to Appellate

Authority.

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(2) The Commissioner may, on his own motion, or

upon request from the Commissioner of central

tax, call for and examine the record of any

proceeding in which an adjudicating authority has

passed any decision or order under this Act or the

Central Goods and Services Tax Act, for the

purpose of satisfying himself as to the legality or

propriety of the said decision or order and may, by

order, direct any officer subordinate to him to

apply to the Appellate Authority within six

months from the date of communication of the

said decision or order for the determination of

such points arising out of the said decision or

order as may be specified by the Commissioner in

his order.

(3) Where, in pursuance of an order under sub-section

(2), the authorised officer makes an application to

the Appellate Authority, such application shall be

dealt with by the Appellate Authority as if it were

an appeal made against the decision or order of

the adjudicating authority and such authorised

officer were an appellant and the provisions of

this Act relating to appeals shall apply to such

application.

(4) The Appellate Authority may, if he is satisfied

that the appellant was prevented by sufficient

cause from presenting the appeal within the

aforesaid period of three months or six months, as

the case may be, allow it to be presented within a

further period of one month.

(5) Every appeal under this section shall be in such

form and shall be verified in such manner as may

be prescribed.

(6) No appeal shall be filed under sub-section (1),

unless the appellant has paid–

(a) in full, such part of the amount of tax, interest,

fine, fee and penalty arising from the impugned order,

as is admitted by him; and

(b) a sum equal to ten per cent. of the remaining

amount of tax in dispute arising from the said order, in

124

relation to which the appeal has been filed.

(7) Where the appellant has paid the amount under

sub-section (6), the recovery proceedings for the

balance amount shall be deemed to be stayed.

(8) The Appellate Authority shall give an opportunity

to the appellant of being heard.

(9) The Appellate Authority may, if sufficient cause

is shown at any stage of hearing of an appeal,

grant time to the parties or any of them and

adjourn the hearing of the appeal for reasons to be

recorded in writing:

Provided that no such adjournment shall be granted

more than three times to a party during hearing of the

appeal.

(10) The Appellate Authority may, at the time of

hearing of an appeal, allow an appellant to add

any ground of appeal not specified in the grounds

of appeal, if it is satisfied that the omission of that

ground from the grounds of appeal was not wilful

or unreasonable.

(11) The Appellate Authority shall, after making

such further inquiry as may be necessary, pass

such order, as it thinks just and proper,

confirming, modifying or annulling the decision

or order appealed against but shall not refer the

case back to the adjudicating authority that passed

the said decision or order:

Provided that an order enhancing any fee or penalty or

fine in lieu of confiscation or confiscating goods of

greater value or reducing the amount of refund or input

tax credit shall not be passed unless the appellant has been

given a reasonable opportunity of showing cause against

the proposed order:

Provided further that where the Appellate Authority is

of the opinion that any tax has not been paid or short-paid

or erroneously refunded, or where input tax credit has

been wrongly availed or utilised, no order requiring the

appellant to pay such tax or input tax credit shall be

125

passed unless the appellant is given notice to show cause

against the proposed order and the order is passed within

the time limit specified under section 73 or section 74.

(12) The order of the Appellate Authority disposing

of the appeal shall be in writing and shall state the

points for determination, the decision thereon and

the reasons for such decision.

(13) The Appellate Authority shall, where it is

possible to do so, hear and decide every appeal

within a period of one year from the date on

which it is filed:

Provided that where the issuance of order is stayed by

an order of a court or Tribunal, the period of such stay

shall be excluded in computing the period of one year.

(14) On disposal of the appeal, the Appellate

Authority shall communicate the order passed by

it to the appellant, respondent and to the

adjudicating authority.

(15) A copy of the order passed by the Appellate

Authority shall also be sent to the Commissioner

or the authority designated by him in this behalf

and the jurisdictional Commissioner of central tax

or an authority designated by him in this behalf.

(16) Every order passed under this section shall,

subject to the provisions of section 108 or section

113 or section 117 or section 118 be final and

binding on the parties.

108. (1) Subject to the provisions of section 121 and

any rules made there under, the Revisional Authority

may, on his own motion, or upon information received

by him or on request from the Commissioner of

central tax, call for and examine the record of any

proceedings, and if he considers that any decision or

order passed under this Act or under the Central

Goods and Services Tax Act by any officer

subordinate to him is erroneous in so far as it is

prejudicial to the interest of revenue and is illegal or

improper or has not taken into account certain

material facts, whether available at the time of

Powers of Revisional

Authority.

126

issuance of the said order or not or in consequence of

an observation by the Comptroller and Auditor

General of India, he may, if necessary, stay the

operation of such decision or order for such period as

he deems fit and after giving the person concerned an

opportunity of being heard and after making such

further inquiry as may be necessary, pass such order,

as he thinks just and proper, including enhancing or

modifying or annulling the said decision or order.

(2) The Revisional Authority shall not exercise any

power under sub-section (1), if––

(a) the order has been subject to an appeal under

section 107 or section 112 or section 117 or section

118; or

(b) the period specified under sub-section (2) of

section 107 has not yet expired or more than three

years have expired after the passing of the decision or

order sought to be revised; or

(c) the order has already been taken for revision

under this section at an earlier stage; or

(d) the order has been passed in exercise of the

powers under sub-section (1):

Provided that the Revisional Authority may pass an

order under sub-section (1) on any point which has not

been raised and decided in an appeal referred to in clause

(a) of sub-section (2), before the expiry of a period of one

year from the date of the order in such appeal or before

the expiry of a period of three years referred to in clause

(b) of that sub-section, whichever is later.

(3) Every order passed in revision under sub-section

(1) shall, subject to the provisions of section 113

or section 117 or section 118, be final and binding

on the parties.

(4) If the said decision or order involves an issue on

which the Appellate Tribunal or the High Court

has given its decision in some other proceedings

and an appeal to the High Court or the Supreme

Court against such decision of the Appellate

Tribunal or the High Court is pending, the period

127

spent between the date of the decision of the

Appellate Tribunal and the date of the decision of

the High Court or the date of the decision of the

High Court and the date of the decision of the

Supreme Court shall be excluded in computing the

period of limitation referred to in clause (b) of

sub-section (2) where proceedings for revision

have been initiated by way of issue of a notice

under this section.

(5) Where the issuance of an order under sub-section

(1) is stayed by the order of a court or Appellate

Tribunal, the period of such stay shall be excluded

in computing the period of limitation referred to in

clause (b) of sub-section (2).

(6) For the purposes of this section, the term,––

(i) “record” shall include all records relating to any

proceedings under this Act available at the time of

examination by the Revisional Authority;

(ii) “decision” shall include intimation given by

any officer lower in rank than the Revisional

Authority.

109. (1) Subject to the provisions of this Chapter, the

Goods and Services Tax Tribunal constituted under

the Central Goods and Services Tax Act shall be the

Appellate Tribunal for hearing appeals against the

orders passed by the Appellate Authority or the

Revisional Authority under this Act.

Appellate Tribunal

and Benches thereof.

(2) The constitution and jurisdiction of the State

Bench and the Area Benches located in the State

shall be in accordance with the provisions of section

109 of the Central Goods and Services Tax Act or

the rules made thereunder.

110. The qualifications, appointment, salary and

allowances, terms of office, resignation and removal

of the President and Members of the State Bench

and Area Benches shall be in accordance with the

provisions of section 110 of the Central Goods and

Services Tax Act.

President and

Members of

Appellate Tribunal,

their qualification,

appointment,

conditions of service,

etc.

111. (1) The Appellate Tribunal shall not, while Procedure before

128

5 of 1908.

disposing of any proceedings before it or an appeal

before it, be bound by the procedure laid down in the

Code of Civil Procedure, 1908, but shall be guided by

the principles of natural justice and subject to the

other provisions of this Act and the rules made

thereunder, the Appellate Tribunal shall have power to

regulate its own procedure.

Appellate Tribunal.

5 of 1908.

(2) The Appellate Tribunal shall, for the purposes of

discharging its functions under this Act, have the

same powers as are vested in a civil court under

the Code of Civil Procedure, 1908, while trying a

suit in respect of the following matters, namely:—

(a) summoning and enforcing the attendance of any

person and examining him on oath;

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

1 of 1872.

(d) subject to the provisions of sections 123 and 124 of

the Indian Evidence Act, 1872, requisitioning any public

record or document or a copy of such record or document

from any office;

(e) issuing commissions for the examination of witnesses

or documents;

(f) dismissing a representation for default or deciding it ex

parte;

(g) setting aside any order of dismissal of any

representation for default or any order passed by it ex

parte; and

(h) any other matter which may be prescribed.

(3) Any order made by the Appellate Tribunal may be

enforced by it in the same manner as if it were a

decree made by a court in a suit pending therein,

and it shall be lawful for the Appellate Tribunal to

send for execution of its orders to the court within

the local limits of whose jurisdiction,—

(a) in the case of an order against a company, the

129

registered office of the company is situated; or

(b) in the case of an order against any other person, the

person concerned voluntarily resides or carries on

business or personally works for gain.

45 of 1860.

2 of 1974.

(4) All proceedings before the Appellate Tribunal

shall be deemed to be judicial proceedings within

the meaning of sections 193 and 228, and for the

purposes of section 196 of the Indian Penal Code,

and the Appellate Tribunal shall be deemed to be

civil court for the purposes of section 195 and

Chapter XXVI of the Code of Criminal Procedure,

1973.

112. (1) Any person aggrieved by an order passed

against him under section 107 or section 108 of this

Act or the Central Goods and Services Tax Act may

appeal to the Appellate Tribunal against such order

within three months from the date on which the order

sought to be appealed against is communicated to the

person preferring the appeal.

Appeals to Appellate

Tribunal.

(2) The Appellate Tribunal may, in its discretion,

refuse to admit any such appeal where the tax or

input tax credit involved or the difference in tax or

input tax credit involved or the amount of fine, fee

or penalty determined by such order, does not

exceed fifty thousand rupees.

(3) The Commissioner may, on his own motion, or

upon request from the Commissioner of central

tax, call for and examine the record of any order

passed by the Appellate Authority or the

Revisional Authority under this Act or under the

Central Goods and Services Tax Act for the

purpose of satisfying himself as to the legality or

propriety of the said order and may, by order,

direct any officer subordinate to him to apply to

the Appellate Tribunal within six months from the

date on which the said order has been passed for

determination of such points arising out of the

said order as may be specified by the

Commissioner in his order.

(4) Where in pursuance of an order under sub-section

130

(3) the authorised officer makes an application to

the Appellate Tribunal, such application shall be

dealt with by the Appellate Tribunal as if it were

an appeal made against the order under sub-

section (11) of section 107 or under sub-section

(1) of section 108 and the provisions of this Act

shall apply to such application, as they apply in

relation to appeals filed under sub-section (1).

(5) On receipt of notice that an appeal has been

preferred under this section, the party against

whom the appeal has been preferred may,

notwithstanding that he may not have appealed

against such order or any part thereof, file, within

forty five days of the receipt of notice, a

memorandum of cross-objections, verified in the

prescribed manner, against any part of the order

appealed against and such memorandum shall be

disposed of by the Appellate Tribunal, as if it

were an appeal presented within the time specified

in sub-section (1).

(6) The Appellate Tribunal may admit an appeal

within three months after the expiry of the period

referred to in sub-section (1), or permit the filing

of a memorandum of cross-objections within forty

five days after the expiry of the period referred to

in sub-section (5), if it is satisfied that there was

sufficient cause for not presenting it within that

period.

(7) An appeal to the Appellate Tribunal shall be in

such form, verified in such manner and shall be

accompanied by such fee, as may be prescribed.

(8) No appeal shall be filed under sub-section (1),

unless the appellant has paid––

(a) in full, such part of the amount of tax, interest,

fine, fee and penalty arising from the impugned order,

as is admitted by him, and

(b) a sum equal to twenty per cent. of the

remaining amount of tax in dispute, in addition to the

amount paid under sub-section (6) of the section 107,

arising from the said order, in relation to which the

appeal has been filed.

131

(9) Where the appellant has paid the amount as per

sub-section (8), the recovery proceedings for the

balance amount shall be deemed to be stayed till

the disposal of the appeal.

(10) Every application made before the Appellate

Tribunal, —

(a) in an appeal for rectification of error or for any

other purpose; or

(b) for restoration of an appeal or an application,

shall be accompanied by such fees as may be prescribed.

113. (1) The Appellate Tribunal may, after giving the

parties to the appeal an opportunity of being heard,

pass such orders thereon as it thinks fit, confirming,

modifying or annulling the decision or order appealed

against or may refer the case back to the Appellate

Authority, or the Revisional Authority or to the

original adjudicating authority, with such directions as

it may think fit, for a fresh adjudication or decision

after taking additional evidence, if necessary.

Orders of Appellate

Tribunal.

(2) The Appellate Tribunal may, if sufficient cause is

shown, at any stage of hearing of an appeal, grant

time to the parties or any of them and adjourn the

hearing of the appeal for reasons to be recorded in

writing:

Provided that no such adjournment shall be granted

more than three times to a party during hearing of the

appeal.

(3) The Appellate Tribunal may amend any order

passed by it under sub-section (1) so as to rectify

any error apparent on the face of the record, if

such error is noticed by it on its own accord, or is

brought to its notice by the Commissioner or the

Commissioner of central tax or the other party to

the appeal within a period of three months from

the date of the order:

Provided that no amendment which has the effect of

enhancing an assessment or reducing a refund or input tax

credit or otherwise increasing the liability of the other

132

party, shall be made under this sub-section, unless the

party has been given an opportunity of being heard.

(4) The Appellate Tribunal shall, as far as possible,

hear and decide every appeal within a period of

one year from the date on which it is filed.

(5) The Appellate Tribunal shall send a copy of every

order passed under this section to the Appellate

Authority or the Revisional Authority, or the

original adjudicating authority, as the case may

be, the appellant and the Commissioner or the

jurisdictional Commissioner of central tax.

(6) Save as provided in section 117 or section 118,

orders passed by the Appellate Tribunal on an

appeal shall be final and binding on the parties.

114. The State President shall exercise such financial

and administrative powers over the State Bench and

Area Benches of the Appellate Tribunal in a State,

as may be prescribed:

Financial and

administrative

powers of State

President.

Provided that the State President shall have the

authority to delegate such of his financial and

administrative powers as he may think fit to any other

Member or any officer of the State Bench or Area

Benches, subject to the condition that such Member or

officer shall, while exercising such delegated powers,

continue to act under the direction, control and

supervision of the State President.

115. Where an amount paid by the appellant under sub-

section (6) of section 107 or sub-section (8) of section

112 is required to be refunded consequent to any order

of the Appellate Authority or of the Appellate

Tribunal, interest at the rate specified under section 56

shall be payable in respect of such refund from the

date of payment of the amount till the date of refund

of such amount.

Interest on refund of

amount paid for

admission of appeal.

116. (1) Any person who is entitled or required to

appear before an officer appointed under this Act, or

the Appellate Authority or the Appellate Tribunal in

connection with any proceedings under this Act, may,

otherwise than when required under this Act to appear

Appearance by

authorised

representative.

133

personally for examination on oath or affirmation,

subject to the other provisions of this section, appear

by an authorised representative.

(2) For the purposes of this Act, the expression

“authorised representative” shall mean a person

authorised by the person referred to in sub-section

(1) to appear on his behalf, being —

(a) his relative or regular employee; or

(b) an advocate who is entitled to practice in any

court in India, and who has not been debarred from

practicing before any court in India; or

(c) any chartered accountant, a cost accountant or a

company secretary, who holds a certificate of practice

and who has not been debarred from practice; or

(d) a retired officer of the Commercial Tax

Department of any State Government or Union

territory or of the Board who, during his service under

the Government, had worked in a post not below the

rank than that of a Group-B Gazetted officer for a

period of not less than two years:

Provided that such officer shall not be entitled to

appear before any proceedings under this Act for a

period of one year from the date of his retirement or

resignation; or

(e) any person who has been authorised to act as a

goods and services tax practitioner on behalf of the

concerned registered person.

(3) No person, —

(a) who has been dismissed or removed from

Government service; or

(b) who is

convicted of an offence connected with any

proceedings under this Act, the Central Goods and

Services Tax Act, the Integrated Goods and Services

Tax Act or the Union Territory Goods and Services

Tax Act, or under the existing law or under any of the

134

Acts passed by a State Legislature dealing with the

imposition of taxes on sale of goods or supply of

goods or services or both; or

(c) who is found guilty of misconduct by the prescribed

authority;

(d) who has been adjudged as an insolvent,

shall be qualified to represent any person under sub-

section (1)––

(i) for all times in case of persons referred to in

clauses (a),(b) and (c); and

(ii) for the period during which the insolvency

continues in the case of a person referred to in clause

(d).

(4) Any person who has been disqualified under the

provisions of the Central Goods and Services Tax

Act or the Goods and Services Tax Act of any

other State or the Union Territory Goods and

Services Tax Act shall be deemed to be

disqualified under this Act.

117. (1) Any person aggrieved by any order passed by

the State Bench or Area Benches of the Appellate

Tribunal may file an appeal to the High Court and the

High Court may admit such appeal, if it is satisfied

that the case involves a substantial question of law.

Appeal to High

Court.

(2) An appeal under sub-section (1) shall be filed

within a period of one hundred and eighty days

from the date on which the order appealed against

is received by the aggrieved person and it shall be

in such form, verified in such manner as may be

prescribed:

Provided that the High Court may entertain an appeal

after the expiry of the said period if it is satisfied that

there was sufficient cause for not filing it within such

period.

(3) Where the High Court is satisfied that a

substantial question of law is involved in any case,

135

it shall formulate that question and the appeal

shall be heard only on the question so formulated,

and the respondents shall, at the hearing of the

appeal, be allowed to argue that the case does not

involve such question:

Provided that nothing in this sub-section shall be

deemed to take away or abridge the power of the court to

hear, for reasons to be recorded, the appeal on any other

substantial question of law not formulated by it, if it is

satisfied that the case involves such question.

(4) The High Court shall decide the question of law

so formulated and deliver such judgment thereon

containing the grounds on which such decision is

founded and may award such cost as it deems fit.

(5) The High Court may determine any issue which–

(a) has not been determined by the State Bench or

Area Benches; or

(b) has been wrongly determined by the State

Bench or Area Benches, by reason of a decision on

such question of law as herein referred to in sub-

section (3).

(6) Where an appeal has been filed before the High

Court, it shall be heard by a Bench of not less than

two Judges of the High Court, and shall be

decided in accordance with the opinion of such

Judges or of the majority, if any, of such Judges.

(7) Where there is no such majority, the Judges shall

state the point of law upon which they differ and

the case shall, then, be heard upon that point only,

by one or more of the other Judges of the High

Court and such point shall be decided according to

the opinion of the majority of the Judges who

have heard the case including those who first

heard it.

(8) Where the High Court delivers a judgment in an

appeal filed before it under this section, effect

shall be given to such judgment by either side on

the basis of a certified copy of the judgment.

136

5 of 1908

(9) Save as otherwise provided in this Act, the

provisions of the Code of Civil Procedure, 1908,

relating to appeals to the High Court shall, as far

as may be, apply in the case of appeals under this

section.

118. (1) An appeal shall lie to the Supreme Court-

(a) from any order passed by the National Bench or

Regional Benches of the Appellate Tribunal; or

Appeal to Supreme

Court.

(b) from any judgment or order passed by the High Court

in an appeal made under section 117 in any case which,

on its own motion or on an application made by or on

behalf of the party aggrieved, immediately after passing

of the judgment or order, the High Court certifies to be a

fit one for appeal to the Supreme Court.

5 of 1908 (2) The provisions of the Code of Civil Procedure,

1908, relating to appeals to the Supreme Court

shall, so far as may be, apply in the case of

appeals under this section as they apply in the case

of appeals from decrees of a High Court.

(3) Where the judgment of the High Court is varied or

reversed in the appeal, effect shall be given to the

order of the Supreme Court in the manner

provided in section 117 in the case of a judgment

of the High Court.

119. Notwithstanding that an appeal has been preferred

to the High Court or the Supreme Court, sums due to

the Government as a result of an order passed by the

National or Regional Benches of the Appellate

Tribunal under sub-section (1) of section 113 or an

order passed by the State Bench or Area Benches of

the Appellate Tribunal under sub-section (1) of

section 113 or an order passed by the High Court

under section 117, as the case may be, shall be

payable in accordance with the order so passed.

Sums due to be paid

notwithstanding

appeal etc.

120. (1) The Commissioner may, on the

recommendations of the Council, from time to time,

issue orders or instructions or directions fixing such

monetary limits, as he may deem fit, for the purposes

Appeal not to be filed

in certain cases.

137

of regulating the filing of appeal or application by the

officer of the State tax under the provisions of this

Chapter.

(2) Where, in pursuance of the orders or instructions

or directions issued under sub-section (1), the

officer of the State tax has not filed an appeal or

application against any decision or order passed

under the provisions of this Act, it shall not

preclude such officer of the State tax from filing

appeal or application in any other case involving

the same or similar issues or questions of law.

(3) Notwithstanding the fact that no appeal or

application has been filed by the officer of the

State tax pursuant to the orders or instructions or

directions issued under sub-section (1), no person,

being a party in appeal or application shall

contend that the officer of the State tax has

acquiesced in the decision on the disputed issue

by not filing an appeal or application.

(4) The Appellate Tribunal or court hearing such

appeal or application shall have regard to the

circumstances under which appeal or application

was not filed by the officer of the State tax in

pursuance of the orders or instructions or

directions issued under sub-section (1).

121. Notwithstanding anything to the contrary in any

provisions of this Act, no appeal shall lie against any

decision taken or order passed by an officer of State

tax if such decision taken or order passed relates to

any one or more of the following matters, namely:–

Non appealable

decisions and orders.

(a) an order of the Commissioner or other authority

empowered to direct transfer of proceedings from one

officer to another officer; or

(b) an order pertaining to the seizure or retention of

books of account, register and other documents; or

(c) an order sanctioning prosecution under this Act;

or

(d) an order passed under section 80.

138

CHAPTER XIX

OFFENCES AND PENALTIES

122. (1) Where a taxable person who–– Penalty for certain

offences.

(i) supplies any goods or services or both without

issue of any invoice or issues an incorrect or false

invoice with regard to any such supply;

(ii) issues any invoice or bill without supply of

goods or services or both in violation of the provisions

of this Act or the rules made there under;

(iii) collects any amount as tax but fails to pay the

same to the Government beyond a period of three

months from the date on which such payment becomes

due;

(iv) collects any tax in contravention of the

provisions of this Act but fails to pay the same to the

Government beyond a period of three months from the

date on which such payment becomes due;

(v) fails to deduct the tax in accordance with the

provisions of sub-section (1) of section 51, or deducts

an amount which is less than the amount required to

be deducted under the said sub-section, or where he

fails to pay to the Government under sub-section (2)

thereof, the amount deducted as tax;

(vi) fails to collect tax in accordance with the

provisions of sub-section (1) of section 52, or collects

an amount which is less than the amount required to be

collected under the said sub-section or where he fails

to pay to the Government the amount collected as tax

under sub-section (3) of section 52;

(vii) takes or utilizes input tax credit without actual

receipt of goods or services or both either fully or

partially, in contravention of the provisions of this Act

or the rules made there under;

(viii) fraudulently obtains refund of tax under this

Act;

139

(ix) takes or distributes input tax credit in

contravention of section 20, or the rules made there

under;

(x) falsifies or substitutes financial records or

produces fake accounts or documents or furnishes any

false information or return with an intention to evade

payment of tax due under this Act;

(xi) is liable to be registered under this Act but fails

to obtain registration;

(xii) furnishes any false information with regard to

registration particulars, either at the time of applying

for registration, or subsequently;

(xiii) obstructs or prevents any officer in discharge

of his duties under this Act;

(xiv) transports any taxable goods without the

cover of documents as may be specified in this behalf;

(xv) suppresses his turnover leading to evasion of

tax under this Act;

(xvi) fails to keep, maintain or retain books of

account and other documents in accordance with the

provisions of this Act or the rules made there under;

(xvii) fails to furnish information or documents

called for by an officer in accordance with the

provisions of this Act or the rules made there under or

furnishes false information or documents during any

proceedings under this Act;

(xviii) supplies, transports or stores any goods

which he has reasons to believe are liable to

confiscation under this Act;

(xix) issues any invoice or document by using the

registration number of another registered person;

(xx) tampers with, or destroys any material

evidence or documents;

140

(xxi) disposes off or tampers with any goods that

have been detained, seized, or attached under this Act,

he shall be liable to pay a penalty of ten thousand rupees

or an amount equivalent to the tax evaded or the tax not

deducted under section 51 or short deducted or deducted

but not paid to the Government or tax not collected under

section 52 or short collected or collected but not paid to

the Government or input tax credit availed of or passed on

or distributed irregularly, or the refund claimed

fraudulently, whichever is higher.

(2) Any registered person who supplies any goods or

services or both on which any tax has not been

paid or short-paid or erroneously refunded, or

where the input tax credit has been wrongly

availed or utilized,-

(a) for any reason, other than the reason of fraud

or any wilful misstatement or suppression of

facts to evade tax, shall be liable to a penalty

of ten thousand rupees or ten per cent. of the

tax due from such person, whichever is higher;

(b) for reason of fraud or any wilful misstatement

or suppression of facts to evade tax, shall be

liable to a penalty equal to ten thousand rupees

or the tax due from such person, whichever is

higher.

(3) Any person who––

(a) aids or abets any of the offences specified in

clauses (i) to (xxi) of sub-section (1);

(b) acquires possession of, or in any way concerns

himself in transporting, removing, depositing, keeping,

concealing, supplying, or purchasing or in any other

manner deals with any goods which he knows or has

reasons to believe are liable to confiscation under this

Act or the rules made there under;

(c) receives or is in any way concerned with the

supply of, or in any other manner deals with any

supply of services which he knows or has reasons to

believe are in contravention of any provisions of this

Act or the rules made there under;

141

(d) fails to appear before the officer of State tax,

when issued with a summon for appearance to give

evidence or produce a document in an inquiry;

(e) fails to issue invoice in accordance with the

provisions of this Act or the rules made there under or

fails to account for an invoice in his books of account,

shall be liable to a penalty which may extend to twenty

five thousand rupees.

123. If a person who is required to furnish an

information return under section 150 fails to do so

within the period specified in the notice issued under

sub-section (3) thereof, the proper officer may direct,

that such person shall be liable to pay a penalty of one

hundred rupees for each day of the period during

which the failure to furnish such return continues:

Penalty for failure to

furnish information

return.

Provided that the penalty imposed under this section

shall not exceed five thousand rupees.

124. If any person required to furnish any information

or return under section 151,—

Fine for failure to

furnish statistics.

(a) without reasonable cause fails to furnish such

information or return as may be required under that

section, or

(b) wilfully furnishes or causes to furnish any

information or return which he knows to be false,

he shall be punishable with a fine which may extend to

ten thousand rupees and in case of a continuing offence

to a further fine which may extend to one hundred rupees

for each day after the first day during which the offence

continues subject to a maximum limit of twenty five

thousand rupees.

125. Any person, who contravenes any of the

provisions of this Act or any rules made there under

for which no penalty is separately provided for in this

Act, shall be liable to a penalty which may extend to

twenty five thousand rupees.

General penalty.

126. (1) No officer under this Act shall impose any General disciplines

142

penalty for minor breaches of tax regulations or

procedural requirements and in particular, any

omission or mistake in documentation which is easily

rectifiable and made without fraudulent intent or gross

negligence.

related to penalty.

Explanation.––For the purpose of this sub-section,––

(a) a breach shall be considered a ‘minor breach’ if

the amount of tax involved is less than five thousand

rupees;

(b) an omission or mistake in documentation shall

be considered to be easily rectifiable if the same is an

error apparent on the face of record.

(2) The penalty imposed under this Act shall depend

on the facts and circumstances of each case and

shall commensurate with the degree and severity

of the breach.

(3) No penalty shall be imposed on any person

without giving him an opportunity of being heard.

(4) The officer under this Act shall while imposing

penalty in an order for a breach of any law,

regulation or procedural requirement, specify the

nature of the breach and the applicable law,

regulation or procedure under which the amount

of penalty for the breach has been specified.

(5) When a person voluntarily discloses to an officer

under this Act the circumstances of a breach of the

tax law, regulation or procedural requirement

prior to the discovery of the breach by the officer

under this Act, the proper officer may consider

this fact as a mitigating factor when quantifying a

penalty for that person.

(6) The provisions of this section shall not apply in

such cases where the penalty specified under this

Act is either a fixed sum or expressed as a fixed

percentage.

127. Where the proper officer is of the view that a

person is liable to a penalty and the same is not

Power to impose

penalty in certain

143

covered under any proceedings under section 62 or

section 63 or section 64 or section 73 or section 74 or

section 129 or section 130, he may issue an order

levying such penalty after giving a reasonable

opportunity of being heard to such person.

cases.

128. The Government may, by notification, waive in

part or full, any penalty referred to in section 122or

section 123 or section 125 or any late fee referred to in

section 47 for such class of taxpayers and under such

mitigating circumstances as may be specified therein

on the recommendations of the Council.

Power to waive

penalty or fee or both

129. (1) Notwithstanding anything contained in this

Act, where any person transports any goods or stores

any goods while they are in transit in contravention of

the provisions of this Act or the rules made there

under, all such goods and conveyance used as a means

of transport for carrying the said goods and documents

relating to such goods and conveyance shall be liable

to detention or seizure and after detention or seizure,

shall be released,––

Detention, seizure

and release of goods

and conveyances in

transit.

(a) on payment of the applicable tax and penalty equal to

one hundred per cent. of the tax payable on such goods

and, in case of exempted goods, on payment of an amount

equal to two per cent of the value of goods or twenty five

thousand rupees, whichever is less, where the owner of

the goods comes forward for payment of such tax and

penalty;

(b) on payment of the applicable tax and penalty equal

to the fifty per cent. of the value of the goods

reduced by the tax amount paid thereon and, in

case of exempted goods, on payment of an amount

equal to five per cent of the value of goods or

twenty five thousand rupees, whichever is less,

where the owner of the goods does not come

forward for payment of such tax and penalty;

(c) upon furnishing a security equivalent to the

amount payable under clause (a) or clause (b)in

such form and manner as may be prescribed:

Provided that no such goods or conveyance shall be

144

detained or seized without serving an order of

detention or seizure on the person transporting the

goods.

(2) The provisions of sub-section (6) of section 67 shall,

mutatis mutandis, apply for detention and seizure of

goods and conveyances.

(3) The proper officer detaining or seizing goods or

conveyances shall issue a notice specifying the tax

and penalty payable and thereafter, pass an order for

payment of tax and penalty under clause (a) or clause

(b)or clause (c).

(4) No tax, interest or penalty shall be determined under

sub-section (3) without giving the person concerned

an opportunity of being heard.

(5) On payment of amount referred in sub-section (1), all

proceedings in respect of the notice specified in sub-

section (3) shall be deemed to be concluded.

(6) Where the person transporting any goods orthe owner

of the goods fails to pay the amount of tax and penalty

as provided in sub-section (1) within seven days of

such detention or seizure, further proceedings shall be

initiated in accordance with the provisions of section

130:

Provided that where the detained or seized goods are

perishable or hazardous in nature or are likely to

depreciate in value with passage of time, the said

period of seven days may be reduced by the proper

officer.

130. (1) Notwithstanding anything contained in this

Act, if any person –

Confiscation of goods

or conveyances and

levy of penalty.

(i) supplies or receives any goods in contravention of any

of the provisions of this Act or the rules made there under

with intent to evade payment of tax; or

(ii) does not account for any goods on which he is liable

to pay tax under this Act; or

(iii) supplies any goods liable to tax under this Act

145

without having applied for registration; or

(iv) contravenes any of the provisions of this Act or the

rules made there under with intent to evade payment of

tax; or

(v) uses any conveyance as a means of transport for

carriage of goods in contravention of the provisions of

this Act or the rules made there under unless the owner of

the conveyance proves that it was so used without the

knowledge or connivance of the owner himself, his agent,

if any, and the person in charge of the conveyance,

then, all such goods or conveyances shall be liable to

confiscation and the person shall be liable to penalty

under section 122.

(2) Whenever confiscation of any goods or conveyance is

authorised by this Act, the officer adjudging it shall

give to the owner of the goods an option to pay in lieu

of confiscation, such fine as the said officer thinks fit:

Provided that such fine leviable shall not exceed the

market value of the goods confiscated, less the tax

chargeable thereon:

Provided further that the aggregate of such fine and

penalty leviable shall not be less than the amount of

penalty leviable under sub-section (1) of section 129:

Provided also that where any such conveyance is used for

the carriage of the goods or passengers for hire, the owner

of the conveyance shall be given an option to pay in lieu

of the confiscation of the conveyance a fine equal to the

tax payable on the goods being transported thereon.

(3) Where any fine in lieu of confiscation of goods or

conveyance is imposed under sub-section (2), the

owner of such goods or conveyance or the person

referred to in sub-section (1), shall, in addition, be

liable to any tax, penalty and charges payable in

146

respect of such goods or conveyance.

(4) No order for confiscation of goods or conveyance or

for imposition of penalty shall be issued without

giving the person an opportunity of being heard.

(5) Where any goods or conveyance are confiscated under

this Act, the title of such goods or conveyance shall

thereupon vest in the Government.

(6) The proper officer adjudging confiscation shall take

and hold possession of the things confiscated and

every officer of Police, on the requisition of such

proper officer, shall assist him in taking and holding

such possession.

(7) The proper officer may, after satisfying himself that

the confiscated goods or conveyance are not required

in any other proceedings under this Act and after

giving reasonable time not exceeding three months to

pay fine in lieu of confiscation, dispose of such goods

or conveyance and deposit the sale proceeds thereof

with the Government.

2 of 1974.

131. Without prejudice to the provisions contained in

the Code of Criminal Procedure, 1973, no confiscation

made or penalty imposed under the provisions of this

Act or the rules made there under shall prevent the

infliction of any other punishment to which the person

affected thereby is liable under the provisions of this

Act or under any other law for the time being in force.

Confiscation or

penalty not to

interfere with other

punishments.

132. (1) Whoever commits any of the following

offences, namely:—

Punishment for

certain offences

(a) supplies any goods or services or both without issue of

any invoice, in violation of the provisions of this Act or

the rules made there under, with the intention to evade

tax;

(b) issues any invoice or bill without supply of goods or

services or both in violation of the provisions of this Act,

or the rules made there under leading to wrongful

availment or utilisation of input tax credit or refund of

tax;

147

(c) avails input tax credit using such invoice or bill

referred to in clause (b);

(d) collects any amount as tax but fails to pay the same to

the Government beyond a period of three months from the

date on which such payment becomes due;

(e) evades tax, fraudulently avails input tax credit or

fraudulently obtains refund and where such offence is not

covered under clauses (a) to (d);

(f) falsifies or substitutes financial records or produces

fake accounts or documents or furnishes any false

information with an intention to evade payment of tax due

under this Act;

(g) obstructs or prevents any officer in the discharge of

his duties under this Act;

(h) acquires possession of, or in any way concerns himself

in transporting, removing, depositing, keeping,

concealing, supplying, purchasing or in any other manner

deals with, any goods which he knows or has reasons to

believe are liable to confiscation under this Act or the

rules made there under;

(i) receives or is in any way concerned with the supply of,

or in any other manner deals with any supply of services

which he knows or has reasons to believe are in

contravention of any provisions of this Act or the rules

made there under;

(j) tampers with or destroys any material evidence or

documents;

(k) fails to supply any information which he is required to

supply under this Act or the rules made there under or

(unless with a reasonable belief, the burden of proving

which shall be upon him, that the information supplied by

148

him is true) supplies false information; or

(l) attempts to commit, or abets the commission of any of

the offences mentioned in clauses (a) to (k) of this section,

shall be punishable––

(i) in cases where the amount of tax evaded or the amount

of input tax credit wrongly availed or utilised or the

amount of refund wrongly taken exceeds five hundred

lakh rupees, with imprisonment for a term which may

extend to five years and with fine;

(ii) in cases where the amount of tax evaded or the

amount of input tax credit wrongly availed or utilised or

the amount of refund wrongly taken exceeds two hundred

lakh rupees but does not exceed five hundred lakh rupees,

with imprisonment for a term which may extend to three

years and with fine;

(iii) in the case of any other offence where the amount of

tax evaded or the amount of input tax credit wrongly

availed or utilised or the amount of refund wrongly taken

exceeds one hundred lakh rupees but does not exceed two

hundred lakh rupees, with imprisonment for a term which

may extend to one year and with fine;

(iv) in cases where he commits or abets the commission

of an offence specified in clause (f) or clause (g) or clause

(j), he shall be punishable with imprisonment for a term

which may extend to six months or with fine or with both.

(2) Where any person convicted of an offence under this

section is again convicted of an offence under this

section, then, he shall be punishable for the second

and for every subsequent offence with imprisonment

for a term which may extend to five years and with

fine.

(3) The imprisonment referred to in clauses (i), (ii) and

(iii) of sub-section (1) and sub-section (2) shall, in the

149

absence of special and adequate reasons to the

contrary to be recorded in the judgment of the Court,

be for a term not less than six months.

(4) Notwithstanding anything contained in the Code of

Criminal Procedure, 1973, all offences under this Act,

except the offences referred to in sub-section (5) shall

be non-cognizable and bailable.

(5) The offences specified in clause (a) or clause (b) or

clause (c) or clause (d) of sub-section (1) and

punishable under clause (i) of that sub-section shall be

cognizable and non-bailable.

(6) A person shall not be prosecuted for any offence

under this section except with the previous sanction of

the Commissioner.

Explanation.- For the purposes of this section, the term

“tax” shall include the amount of tax evaded or the

amount of input tax credit wrongly availed or utilised or

refund wrongly taken under the provisions of this Act, the

Central Goods and Services Tax Act, the Integrated

Goods and Services Tax Act, and cess levied under the

Goods and Services Tax (Compensation to States) Act.

133.(1) Where any person engaged in connection with

the collection of statistics under section 151 or

compilation or computerisation thereof or if any officer

of State tax having access to information specified under

sub-section (1) of section 150, or if any person engaged

in connection with the provision of service on the

common portal or the agent of common portal, wilfully

discloses any information or the contents of any return

furnished under this Act or rules made there under

otherwise than in execution of his duties under the said

sections or for the purposes of prosecution for an offence

under this Act or under any other Act for the time being

in force, he shall be punishable with imprisonment for a

term which may extend to six months or with fine which

may extend to twenty five thousand rupees, or with both.

Liability of officers

and certain other

persons.

(2) Any person –

(a) who is a Government servant shall not be prosecuted

150

for any offence under this section except with the

previous sanction of the Government;

(b) who is not a Government servant shall not be

prosecuted for any offence under this section except with

the previous sanction of the Commissioner.

134. No court shall take cognizance of any offence

punishable under this Act or the rules made there

under except with the previous sanction of the

Commissioner, and no court inferior to that of a

Magistrate of the First Class, shall try any such

offence.

Cognizance of

offences.

135. In any prosecution for an offence under this Act

which requires a culpable mental state on the part of

the accused, the court shall presume the existence of

such mental state but it shall be a defence for the

accused to prove the fact that he had no such mental

state with respect to the act charged as an offence in

that prosecution.

Presumption of

culpable mental state.

Explanation.—For the purposes of this section,–

(i) the expression “culpable mental state” includes

intention, motive, knowledge of a fact, and belief in, or

reason to believe, a fact;

(ii) a fact is said to be proved only when the court

believes it to exist beyond reasonable doubt and not

merely when its existence is established by a

preponderance of probability.

136. A statement made and signed by a person on

appearance in response to any summons issued under

section 70 during the course of any inquiry or

proceedings under this Act shall be relevant, for the

purpose of proving, in any prosecution for an offence

under this Act, the truth of the facts which it

contains,––

Relevancy of

statements under

certain

circumstances.

(a) when the person who made the statement is

dead or cannot be found, or is incapable of giving

evidence, or is kept out of the way by the adverse

party, or whose presence cannot be obtained without

an amount of delay or expense which, under the

151

circumstances of the case, the court considers

unreasonable; or

(b) when the person who made the statement is

examined as a witness in the case before the court and

the court is of the opinion that, having regard to the

circumstances of the case, the statement should be

admitted in evidence in the interest of justice.

137. (1) Where an offence committed by a person

under this Act is a company, every person who, at the

time the offence was committed was in charge of, and

was responsible to, the company for the conduct of

business of the company, as well as the company,

shall be deemed to be guilty of the offence and shall

be liable to be proceeded against and punished

accordingly.

Offences by

Companies.

(2) Notwithstanding anything contained in sub-

section (1), where an offence under this Act has

been committed by a company and it is proved

that the offence has been committed with the

consent or connivance of, or is attributable to any

negligence on the part of, any director, manager,

secretary or other officer of the company, such

director, manager, secretary or other officer shall

also be deemed to be guilty of that offence and

shall be liable to be proceeded against and

punished accordingly.

(3) Where an offence under this Act has been

committed by a taxable person being a partnership

firm or a Limited Liability Partnership or a Hindu

Undivided Family or a trust, the partner or karta

or managing trustee shall be deemed to be guilty

of that offence and shall be liable to be proceeded

against and punished accordingly and the

provisions of sub-section (2) shall mutatis

mutandis apply to such persons.

(4) Nothing contained in this section shall render any

such person liable to any punishment provided in

this Act, if he proves that the offence was

committed without his knowledge or that he had

exercised all due diligence to prevent the

commission of such offence.

152

Explanation.––For the purposes of this section,–

(i) “company” means a body corporate and

includes a firm or other association of individuals; and

(ii) “director”, in relation to a firm, means a partner

in the firm.

2 of 1974.

138. (1) Any offence under this Act may, either before

or after the institution of prosecution, be compounded

by the Commissioner on payment, by the person

accused of the offence, to the Central Government or

the State Government, as the case may be, of such

compounding amount in such manner as may be

prescribed:

Compounding of

offences.

Provided that nothing contained in this section shall

apply to –

(a) a person who

has been allowed to compound once in respect of

any of the offences specified in clauses(a) to (f) of

sub-section (1) of section 132 and the offences

specified in clause (l) which are relatable to

offences specified in clauses (a) to (f) of the said

sub-section;

(b) a person who

has been allowed to compound once in respect of

any offence, other than those in clause (a), under

this Act or under the provisions of any State Goods

and Services Tax Act or the Central Goods and

Services Tax Act or the Union Territory Goods and

Services Tax Act or the Integrated Goods and

Services Tax Act in respect of supplies of value

exceeding one crore rupees;

(c) a person who

has been accused of committing an offence under

this Act which is also an offence under any other

law for the time being in force;

(d) a person who

has been convicted for an offence under this Act by

a court;

153

(e) a person who

has been accused of committing an offence

specified in clause (g) or clause (j) or clause(k) of

sub-section (1) of section 132; and

(f) any other

class of persons or offences as may be prescribed:

Provided further that any compounding allowed under the

provisions of this section shall not affect the proceedings,

if any, instituted under any other law:

Provided also that compounding shall be allowed only

after making payment of tax, interest and penalty involved

in such offences.

(2) The amount for compounding of offences under

this section shall be such as may be prescribed,

subject to the minimum amount not being less

than ten thousand rupees or fifty per cent. of the

tax involved, whichever is higher, and the

maximum amount not being less than thirty

thousand rupees or one hundred and fifty per cent.

of the tax, whichever is higher.

(3) On payment of such compounding amount as may

be determined by the Commissioner, no further

proceedings shall be initiated under this Act

against the accused person in respect of the same

offence and any criminal proceedings, if already

initiated in respect of the said offence, shall stand

abated.

CHAPTER XX

TRANSITIONAL PROVISIONS

139. (1) On and from the appointed day, every person

registered under any of the existing laws and having a

valid Permanent Account Number shall be issued a

certificate of registration on provisional basis, subject

to such conditions and in such form and manner as

may be prescribed, which unless replaced by a final

certificate of registration under sub-section (2), shall

be liable to be cancelled if the conditions so

prescribed are not complied with.

Migration of

existing taxpayers.

(2) The final certificate of registration shall be

granted in such form and manner and subject to

such conditions as may be prescribed.

(3) The certificate of registration issued to a person

under sub-section (1) shall be deemed to have not

154

been issued if the said registration is cancelled in

pursuance of an application filed by such person

that he was not liable to registration under section

22 or section 24.

140. (1) A registered person, other than a person opting

to pay tax under section 10, shall be entitled to take, in

his electronic credit ledger, credit of the amount of

Value Added Tax, and Entry Tax, if any, carried

forward in the return relating to the period ending with

the day immediately preceding the appointed day,

furnished by him under the existing law in such

manner as may be prescribed:

Transitional

arrangements for

input tax credit.

Provided that the registered person shall not be allowed to

take credit in the following circumstances, namely: –

(i) where the said

amount of credit is not admissible as input tax

credit under this Act; or

(ii) where he has

not furnished all the returns required under the

existing law for the period of six months

immediately preceding the appointed date; or

74 of 1956

Provided further that so much of the said credit as is

attributable to any claim related to section 3, sub-section

(3) of section 5, section 6, section 6A or sub-section (8)

of section 8of the Central Sales Tax Act, 1956 which is

not substantiated in the manner, and within the period,

prescribed in rule 12 of the Central Sales Tax

(Registration and Turnover) Rules, 1957 shall not be

eligible to be credited to the electronic credit ledger:

Provided also that an amount equivalent to the credit

specified in the second proviso shall be refunded under

the existing law when the said claims are substantiated

in the manner prescribed in rule 12 of the Central Sales

Tax (Registration and Turnover) Rules, 1957.

(2) A registered person, other than a person opting to

pay tax under section 10, shall be entitled to take,

in his electronic credit ledger, credit of the

unveiled input tax credit in respect of capital

goods, not carried forward in a return, furnished

155

under the existing law by him, for the period

ending with the day immediately preceding the

appointed day in such manner as may be

prescribed:

Provided that the registered person shall not be allowed

to take credit unless the said credit was admissible as

input tax credit under the existing law and is also

admissible as input tax credit under this Act.

Explanation.––For the purposes of this section, the

expression “unavailed input tax credit” means the

amount that remains after subtracting the amount of input

tax credit already availed in respect of capital goods by

the taxable person under the existing law from the

aggregate amount of input tax credit to which the said

person was entitled in respect of the said capital goods

under the existing law.

(3) A registered person, who was not liable to be

registered under the existing law or who was

engaged in the sale of exempted goods or tax free

goods, by whatever name called or goods which

have suffered tax at the first point of their sale in

the State and the subsequent sales of which are

not subject to tax in the State under the existing

law but which are liable to tax under this Act or

where the person was entitled to the credit of input

tax at the time of sale of goods, if any, shall be

entitled to take, in his electronic credit ledger,

credit of the value added tax in respect of inputs

held in stock and inputs contained in semi-

finished or finished goods held in stock on the

appointed day subject to the following conditions

namely:––

(i) such inputs or goods are used or intended to be

used for making taxable supplies under this Act;

(ii) the said registered person is eligible for input

tax credit on such inputs under this Act;

(iii) the said registered person is in possession of

invoice or other prescribed documents evidencing

payment of tax under the existing law in respect of

such inputs; and

(iv) such invoices or other prescribed documents

156

were issued not earlier than twelve months

immediately preceding the appointed day:

Provided that where a registered person, other than

a manufacturer or a supplier of services, is not in

possession of an invoice or any other documents

evidencing payment of tax in respect of inputs, then,

such registered person shall, subject to such conditions,

limitations and safeguards as may be prescribed,

including that the said taxable person shall pass on the

benefit of such credit by way of reduced prices to the

recipient, be allowed to take credit at such rate and in

such manner as may be prescribed.

(4) A registered person, who was engaged in the sale

of taxable goods as well as exempted goods or tax

free goods, by whatever name called, under the

existing law but which are liable to tax under this

Act, shall be entitled to take, in his electronic

credit ledger,-

(a) the amount of credit of the value added tax if

any, carried forward in a return furnished under the

existing law by him in accordance with the provisions

of sub-section (1); and

(b) the amount of credit of the value added tax if

any, in respect of inputs held in stock and inputs

contained in semi-finished or finished goods held in

stock on the appointed day, relating to such exempted

goods or tax free goods, by whatever name called, in

accordance with the provisions of sub-section (3).

(5) A registered person shall be entitled to take, in his

electronic credit ledger, credit of value added tax

and entry tax, if any, in respect of inputs received

on or after the appointed day but the tax in respect

of which has been paid by the supplier under the

existing law, subject to the condition that the

invoice or any other tax paying document of the

same was recorded in the books of account of

such person within a period of thirty days from the

appointed day:

Provided that the period of thirty days may, on

sufficient cause being shown, be extended by the

157

Commissioner for a further period not exceeding thirty

days:

Provided further that the said registered person shall

furnish a statement, in such manner as may be prescribed,

in respect of credit that has been taken under this sub-

section.

(6) A registered person, who was either paying tax at

a fixed rate or paying a fixed amount in lieu of the

tax payable under the existing law shall be entitled

to take, in his electronic credit ledger, credit of

value added tax in respect of inputs held in stock

and inputs contained in semi-finished or finished

goods held in stock on the appointed day subject

to the following conditions, namely:––

(i) such inputs or goods are used or intended to be

used for making taxable supplies under this Act;

(ii) the said registered person is not paying tax

under section 10;

(iii) the said registered person is eligible for input

tax credit on such inputs under this Act;

(iv) the said registered person is in possession of

invoice or other prescribed documents evidencing

payment of tax under the existing law in respect of

inputs; and

(v) such invoices or other prescribed documents

were issued not earlier than twelve months

immediately preceding the appointed day.

(7) The amount of credit under sub-sections (3),

(4) and (6) shall be calculated in such manner as

may be prescribed.

141. (1)Where any inputs received at a place of

business had been despatched as such or

despatched after being partially processed to a job

worker for further processing, testing, repair,

reconditioning or any other purpose in accordance

with the provisions of existing law prior to the

appointed day and such inputs are returned to the

said place on or after the appointed day, no tax

Transitional

provisions relating

to job work.

158

shall be payable if such inputs, after completion of

the job work or otherwise, are returned to the said

place within six months from the appointed day:

Provided that the period of six months may, on

sufficient cause being shown, be extended by the

Commissioner for a further period not exceeding two

months:

Provided further that if such inputs are not returned

within the period specified in this sub-section, the

input tax credit shall be liable to be recovered in

accordance with the provisions of clause (a) of sub-

section (8) of section 142.

(2) Where any semi-finished goods had been

despatched from the place of business to any other

premises for carrying out certain manufacturing

processes in accordance with the provisions of

existing law prior to the appointed day and such

goods (hereafter in this sub-section referred to as

“the said goods”) are returned to the said place on

or after the appointed day, no tax shall be payable

if the said goods, after undergoing manufacturing

processes or otherwise, are returned to the said

place within six months from the appointed day:

Provided that the period of six months may, on

sufficient cause being shown, be extended by the

Commissioner for a further period not exceeding two

months:

Provided further that if the said goods are not

returned within a period specified in this sub-section,

the input tax credit shall be liable to be recovered in

accordance with the provisions of clause (a) of sub-

section (8) of section 142:

Provided also that the person despatching the

goods may, in accordance with the provisions of the

existing law, transfer the said goods to the premises of

any registered person for the purpose of supplying

there from on payment of tax in India or without

payment of tax for exports within the period specified

in this sub-section.

(3) Where any goods had been despatched from the

159

place of business without payment of tax for

carrying out tests or any other process, to any

other premises, whether registered or not, in

accordance with the provisions of existing law

prior to the appointed day and such goods, are

returned to the said place of business on or after

the appointed day, no tax shall be payable if the

said goods, after undergoing tests or any other

process, are returned to such place within six

months from the appointed day:

Provided that the period of six months may, on

sufficient cause being shown, be extended by the

Commissioner for a further period not exceeding two

months:

Provided further that if the said goods are not

returned within the period specified in this sub-

section, the input tax credit shall be liable to be

recovered in accordance with the provisions of clause

(a) of sub-section (8) of section 142:

Provided also that the person despatching the

goods may, in accordance with the provisions of the

existing law, transfer the said goods from the said

other premises on payment of tax in India or without

payment of tax for exports within the period specified

in this sub-section.

(4) The tax under sub-sections (1), (2) and (3) shall

not be payable, only if the person despatching the

goods and the job worker declare the details of the

inputs or goods held in stock by the job worker on

behalf of the said person on the appointed day in

such form and manner and within such time as

may be prescribed.

142. (1)Where any goods on which tax, if any, had

been paid under the existing law at the time of sale

thereof, not being earlier than six months prior to

the appointed day, are returned to any place of

business on or after the appointed day, the

registered person shall be eligible for refund of the

tax paid under the existing law where such goods

are returned by a person, other than a registered

person, to the said place of business within a

Miscellaneous

transitional

provisions.

160

period of six months from the appointed day and

such goods are identifiable to the satisfaction of

the proper officer:

Provided that if the said goods are returned by a

registered person, the return of such goods shall be

deemed to be a supply.

(2) (a)where, in pursuance of a contract entered into

prior to the appointed day, the price of any goods

is revised upwards on or after the appointed day,

the registered person who had sold such goods

shall issue to the recipient a supplementary

invoice or debit note, containing such particulars

as may be prescribed, within thirty days of such

price revision and for the purposes of this Act,

such supplementary invoice or debit note shall be

deemed to have been issued in respect of an

outward supply made under this Act;

(b) where, in pursuance of a contract entered into

prior to the appointed day, the price of any goods

is revised downwards on or after the appointed

day, the registered person who had sold such

goods may issue to the recipient a credit note,

containing such particulars as may be prescribed,

within thirty days of such price revision and for

the purposes of this Act such credit note shall be

deemed to have been issued in respect of an

outward supply made under this Act:

Provided that the registered person shall be

allowed to reduce his tax liability on account of issue

of the credit note only if the recipient of the credit

note has reduced his input tax credit corresponding to

such reduction of tax liability.

(3) Every claim for refund filed by any person before,

on or after the appointed day for refund of any

amount of input tax credit, tax, interest or any

other amount paid under the existing law, shall be

disposed of in accordance with the provisions of

existing law and any amount eventually accruing

to him shall be refunded to him in cash in

accordance with the provisions of the said law:

Provided that where any claim for refund of the

161

amount of input tax credit is fully or partially

rejected, the amount so rejected shall lapse:

Provided further that no refund shall be allowed of

any amount of input tax credit where the balance of

the said amount as on the appointed day has been

carried forward under this Act.

(4) Every claim for refund filed after the appointed

day for refund of any tax paid under the existing

law in respect of the goods exported before or

after the appointed day, shall be disposed of in

accordance with the provisions of the existing

law:

Provided that where any claim for refund of input

tax credit is fully or partially rejected, the amount so

rejected shall lapse:

Provided further that no refund shall be allowed of

any amount of input tax credit where the balance of

the said amount as on the appointed day has been

carried forward under this Act.

(5) Notwithstanding anything to the contrary

contained in this Act, any amount of input tax

credit reversed prior to the appointed day shall not

be admissible as input tax credit under this Act.

(6) (a) every proceeding of appeal, revision, review

or reference relating to a claim for input tax credit

initiated whether before, on or after the appointed

day under the existing law shall be disposed of in

accordance with the provisions of the existing

law, and any amount of credit found to be

admissible to the claimant shall be refunded to

him in cash in accordance with the provisions of

the existing law, and the amount rejected, if any,

shall not be admissible as input tax credit under

this Act:

Provided that no refund shall be allowed of any

amount of input tax credit where the balance of the

said amount as on the appointed day has been carried

162

forward under this Act;

(b) every proceeding of appeal, revision, review

or reference relating to recovery of input tax

credit initiated whether before, on or after the

appointed day under the existing law shall be

disposed of in accordance with the provisions

of the existing law, and if any amount of credit

becomes recoverable as a result of such

appeal, revision, review or reference, the same

shall, unless recovered under the existing law, be

recovered as an arrear of tax under this Act

and the amount so recovered shall not be

admissible as input tax credit under this Act.

(7) (a) every proceeding of appeal, revision, review or

reference relating to any output tax liability

initiated whether before, on or after the appointed

day under the existing law, shall be disposed of in

accordance with the provisions of the existing

law, and if any amount becomes recoverable as a

result of such appeal, revision, review or

reference, the same shall, unless recovered under

the existing law, be recovered as an arrear of tax

under this Act and the amount so recovered shall

not be admissible as input tax credit under this

Act.

(b) every proceeding of appeal, revision, review

or reference relating to any output tax liability

initiated whether before, on or after the appointed

day under the existing law, shall be disposed of in

accordance with the provisions of the existing law,

and any amount found to be admissible to the

claimant shall be refunded to him in cash in

accordance with the provisions of the existing law

and the amount rejected, if any, shall not be

admissible as input tax credit under this Act.

(8) (a) where in pursuance of an assessment or

adjudication proceedings instituted, whether

before, on or after the appointed day under the

existing law, any amount of tax, interest, fine or

penalty becomes recoverable from the person, the

same shall, unless recovered under the existing

law, be recovered as an arrear of tax under this

163

Act and the amount so recovered shall not be

admissible as input tax credit under this Act;

(b) where in pursuance of an assessment or

adjudication proceedings instituted, whether

before, on or after the appointed day under the

existing law, any amount of tax, interest, fine or

penalty becomes refundable to the taxable person,

the same shall be refunded to him in cash under

the said law, and the amount rejected, if any,

shall not be admissible as input tax credit under

this Act.

(9) (a) where any return, furnished under the existing

law, is revised after the appointed day and if,

pursuant to such revision, any amount is found to

be recoverable or any amount of input tax credit is

found to be inadmissible, the same shall, unless

recovered under the existing law, be recovered as

an arrear of tax under this Act and the amount so

recovered shall not be admissible as input tax

credit under this Act;

(b) where any return, furnished under the existing

law, is revised after the appointed day but

within the time limit specified for such

revision under the existing law and if, pursuant

to such revision, any amount is found to be

refundable or input tax credit is found to be

admissible to any taxable person, the same

shall be refunded to him in cash under the

existing law, and the amount rejected, if any,

shall not be admissible as input tax credit

under this Act.

(10) Save as otherwise provided in this Chapter, the

goods or services or both supplied on or after the

appointed day in pursuance of a contract entered

into prior to the appointed day shall be liable to

tax under the provisions of this Act.

(11) (a) notwithstanding anything contained in

section 12, no tax shall be payable on goods under

this Act to the extent the tax was leviable on the

said goods under the Uttar Pradesh Value Added

164

Tax Act, 2008;

32 of 1994

(b) notwithstanding anything contained in section 13,

no tax shall be payable on services under this Act

to the extent the tax was leviable on the said

services under Chapter V of the Finance Act,

1994;

--- of ----

32 of 1994

(c) where tax was paid on any supply, both under the

Uttar Pradesh Value Added Tax Act, 2008 and

under Chapter V of the Finance Act, 1994, tax

shall be leviable under this Act and the taxable

person shall be entitled to take credit of value

added tax or service tax paid under the existing

law to the extent of supplies made after the

appointed day and such credit shall be calculated

in such manner as may be prescribed.

(12) Where any goods sent on approval basis, not

earlier than six months before the appointed day,

are rejected or not approved by the buyer and

returned to the seller on or after the appointed day,

no tax shall be payable thereon if such goods are

returned within six months from the appointed

day:

Provided that the said period of six months may, on

sufficient cause being shown, be extended by the

Commissioner for a further period not exceeding two

months:

Provided further that the tax shall be payable by the

person returning the goods if such goods are liable to

tax under this Act, and are returned after the period

specified in this sub-section:

Provided also that tax shall be payable by the person

who has sent the goods on approval basis if such

goods are liable to tax under this Act, and are not

returned within the period specified in this sub-

section.

(13) Where a supplier has made any sale of goods

in respect of which tax was required to be

deducted at source under the Uttar Pradesh Value

Added Tax, 2008 and has also issued an invoice

for the same before the appointed day, no

deduction of tax at source under section 51 shall

165

be made by the deduct or under the said section

where payment to the said supplier is made on or

after the appointed day.

(14) Where any goods or capital goods belonging to

the principal are lying at the premises of the agent

on the appointed day, the agent shall be entitled to

take credit of the tax paid on such goods or capital

goods subject to fulfilment of the following

conditions:

(i) the agent is a registered taxable person under this

Act;

(ii) both the principal and the agent declare the

details of stock of goods or capital goods lying

with such agent on the day immediately

preceding the appointed day in such form and

manner and within such time as may be

prescribed in this behalf;

(iii) the invoices for such goods or capital goods had

been issued not earlier than twelve months

immediately preceding the appointed day; and

(iv) the principal has either reversed or not availed

of the input tax credit in respect of such,-

(a) goods; or

(b) capital goods or, having availed of such

credit, has reversed the said credit, to the

extent availed of by him.

Explanation.- For the purposes of this Chapter,

the expression “capital goods” shall have the

same meaning as assigned to it in the Uttar

Pradesh Value Added Tax, 2008

CHAPTER XXI

MISCELLANEOUS

143. (1) A registered person (hereafter in this section

referred to as the “principal”) may, under intimation

and subject to such conditions as may be prescribed,

send any inputs or capital goods, without payment of

tax, to a job worker for job work and from there

subsequently send to another job worker and likewise,

Job work procedure.

166

and shall,––

(a) bring back inputs, after completion of job work

or otherwise, or capital goods, other than moulds and

dies, jigs and fixtures, or tools, within one year and

three years, respectively, of their being sent out, to any

of his place of business, without payment of tax;

(b) supply such inputs, after completion of job

work or otherwise, or capital goods, other than moulds

and dies, jigs and fixtures, or tools, within one year and

three years, respectively, of their being sent out from

the place of business of a job worker on payment of tax

within India, or with or without payment of tax for

export, as the case may be:

Provided that the principal shall not supply the

goods from the place of business of a job worker in

accordance with the provisions of this clause unless

the said principal declares the place of business of the

job worker as his additional place of business except in

a case-

(i) where the job worker is registered under

section 25; or

(ii) where the principal is engaged in the supply

of such goods as may be notified by the

Commissioner.

(2) The responsibility for keeping proper accounts for

the inputs or capital goods shall lie with the

principal.

(3) Where the inputs sent for job work are not

received back by the principal after completion of

job work or otherwise in accordance with the

provisions of clause (a) of sub-section (1) or are

not supplied from the place of business of the job

worker in accordance with the provisions of

clause (b) of sub-section (1) within a period of one

year of their being sent out, it shall be deemed that

such inputs had been supplied by the principal to

the job worker on the day when the said inputs

were sent out.

167

(4) Where the capital goods, other than moulds and

dies, jigs and fixtures, or tools, sent for job work

are not received back by the principal in

accordance with the provisions of clause (a) of

sub-section (1) or are not supplied from the place

of business of the job worker in accordance with

the provisions of clause (b) of sub-section (1)

within a period of three years of their being sent

out, it shall be deemed that such capital goods had

been supplied by the principal to the job worker

on the day when the said capital goods were sent

out.

(5) Notwithstanding anything contained in sub-

sections (1) and (2), any waste and scrap

generated during the job work may be supplied by

the job worker directly from his place of business

on payment of tax, if such job worker is

registered, or by the principal, if the job worker is

not registered.

Explanation. - For the purposes of job work, input

includes intermediate goods arising from any treatment or

process carried out on the inputs by the principal or the

job worker.

144. Where any document- Presumption as to

documents in certain

cases.

(i) is produced

by any person under this Act or any other law

for the time being in force; or

(ii) has been

seized from the custody or control of any

person under this Act or any other law for the

time being in force; or

(iii) has been

received from any place outside India in the

course of any proceedings under this Act or any

other law for the time being in force,

and such document is tendered by the prosecution in

evidence against him or any other person who is tried

168

jointly with him, the court shall--

(a) unless the

contrary is proved by such person, presume —

(i) the truth of the contents of such document;

(ii) that the signature and every other part of such

document which purports to be in the handwriting

of any particular person or which the court may

reasonably assume to have been signed by, or to

be in the handwriting of, any particular person, is

in that person’s handwriting, and in the case of a

document executed or attested, that it was

executed or attested by the person by whom it

purports to have been so executed or attested;

(b) admit the

document in evidence notwithstanding that it is

not duly stamped, if such document is otherwise

admissible in evidence.

145. (1) Notwithstanding anything contained in any

other law for the time being in force, —

Admissibility of

micro films, facsimile

copies of documents

and computer

printouts as

documents and as

evidence.

(a) a micro film of a document or the reproduction

of the image or images embodied in such micro film

(whether enlarged or not); or

(b) a facsimile copy of a document; or

(c) a statement contained in a document and

included in a printed material produced by a computer,

subject to such conditions as may be prescribed; or

(d) any information stored electronically in any

device or media, including any hard copies made of

such information,

169

shall be deemed to be a document for the purposes of this

Act and the rules made there under and shall be

admissible in any proceedings there under, without further

proof or production of the original, as evidence of any

contents of the original or of any fact stated therein of

which direct evidence would be admissible.

(2) In any proceedings under this Act and or the rules

made there under, where it is desired to give a

statement in evidence by virtue of this section, a

certificate, —

(a) identifying the document containing the

statement and describing the manner in which it was

produced;

(b) giving such particulars of any device involved

in the production of that document as may be

appropriate for the purpose of showing that the

document was produced by a computer,

shall be evidence of any matter stated in the certificate

and for the purposes of this sub-section it shall be

sufficient for a matter to be stated to the best of the

knowledge and belief of the person stating it.

146. The Government may, on the recommendations of

the Council, notify the Common Goods and Services

Tax Electronic Portal for facilitating registration,

payment of tax, furnishing of returns, computation and

settlement of integrated tax, electronic way bill and

for carrying out such other functions and for such

purposes as may be prescribed.

Common Portal.

147. The Government may, on the recommendations of

the Council, notify certain supplies of goods as

“deemed exports”, where goods supplied do not leave

India, and payment for such supplies is received either

in Indian rupees or in convertible foreign exchange, if

such goods are manufactured in India.

Deemed Exports.

148. The Government may, on the recommendations of

the Council, and subject to such conditions and safe

guards as may be prescribed, notify certain classes of

registered persons, and the special procedures to be

followed by such persons including those with regard

Special procedure for

certain processes.

170

to registration, furnishing of return, payment of tax

and administration of such persons.

149. (1) Every registered person may be assigned a

goods and services tax compliance rating score by the

Government based on his record of compliance with

the provisions of this Act.

Goods and services

tax compliance

rating.

(2) The goods and services tax compliance rating

score may be determined on the basis of such

parameters as may be prescribed.

(3) The goods and services tax compliance rating

score may be updated at periodic intervals and

intimated to the registered person and also placed

in the public domain in such manner as may be

prescribed.

150. (1) Any person, being— Obligation to furnish

information return.

(a) a taxable person; or

(b) a local authority or other public body or

association; or

(c) any authority of the State Government

responsible for the collection of value added tax or

sales tax or State excise duty or an authority of the

Central Government responsible for the collection of

excise duty or customs duty; or

43 of 1961.

(d) an income tax authority appointed under the

provisions of the Income-tax Act, 1961; or

2 of 1934.

(e) a banking company within the meaning of

clause (a) of section 45A of the Reserve Bank of India

Act, 1934; or

36 of 2003.

(f) a State Electricity Board or an electricity

distribution or transmission licensee under the

Electricity Act, 2003, or any other entity entrustedwith

such functions by the Central Government or the State

Government; or

16 of 1908.

(g) the Registrar or Sub-Registrar appointed under

section 6 of the Registration Act, 1908; or

171

18 of 2013.

(h) a Registrar within the meaning of the

Companies Act, 2013; or

59 of 1988.

(i) the registering authority empowered to register

motor vehicles under the Motor Vehicles Act, 1988; or

30 of 2013.

(j) the Collector referred to in clause (c) of section

3 of the Right to Fair Compensation and Transparency

in Land Acquisition, Rehabilitation and Resettlement

Act, 2013; or

42 of 1956.

(k) the recognised stock exchange referred to in

clause (f) of section 2 of the Securities Contracts

(Regulation) Act, 1956; or

22 of 1996.

(l) a depository referred to in clause (e) of sub-

section (1) of section 2 of the Depositories Act, 1996;

or

2 of 1934.

(m) an officer of the Reserve Bank of India as

constituted under section 3 of the Reserve Bank of

India Act, 1934; or

18 of 2013.

(n) the Goods and Services Tax Network, a

company registered under the Companies Act, 2013; or

(o) a person to whom a Unique Identity Number

has been granted under sub-section (9) of section 25;or

(p) any other person as may be specified, on the

recommendations of the Council, by the Government,

who is responsible for maintaining record of registration

or statement of accounts or any periodic return or

document containing details of payment of tax and other

details of transaction of goods or services or both or

transactions related to a bank account or consumption of

electricity or transaction of purchase, sale or exchange of

goods or property or right or interest in a property under

any law for the time being in force, shall furnish an

information return of the same in respect of such periods,

within such time, in such form and manner and to such

authority or agency as may be prescribed.

(2) Where the Commissioner, or an officer authorised

by him in this behalf, considers that the

172

information furnished in the information return is

defective, he may intimate the defect to the person

who has furnished such information return and

give him an opportunity of rectifying the defect

within a period of thirty days from the date of

such intimation or within such further period

which, on an application made in this behalf, the

said authority may allow and if the defect is not

rectified within the said period of thirty days or,

the further period so allowed, then,

notwithstanding anything contained in any other

provisions of this Act, such information return

shall be treated as not furnished and the provisions

of this Act shall apply.

(3) Where a person who is required to furnish

information return has not furnished the same

within the time specified in sub-section (1) or sub-

section (2), the said authority may serve upon him

a notice requiring furnishing of such information

return within a period not exceeding ninety days

from the date of service of the notice and such

person shall furnish the information return.

151. (1) The Commissioner may, if he considers that it

is necessary so to do, by notification, direct that

statistics may be collected relating to any matter dealt

with by or in connection with this Act.

Power to collect

statistics.

(2) Upon such notification being issued, the

Commissioner, or any person authorised by him in

this behalf, may call upon the concerned persons

to furnish such information or returns, in such

form and manner as may be prescribed, relating to

any matter in respect of which statistics is to be

collected.

152. (1) No information of any individual return or part

thereof with respect to any matter given for the

purposes of section 150 or section 151 shall, without

the previous consent in writing of the concerned

person or his authorised representative, be published

in such manner so as to enable such particulars to be

identified as referring to a particular person and no

such information shall be used for the purpose of any

proceedings under this Act.

Bar on disclosure of

information.

173

(2) Except for the purposes of prosecution under this Act

or any other Act for the time being in force, no person

who is not engaged in the collection of statistics under

this Act or compilation or computerisation thereof for

the purposes of this Act, shall be permitted to see or

have access to any information or any individual

return referred to in section 151.

(3) Nothing in this section shall apply to the

publication of any information relating to a class

of taxable persons or class of transactions, if in the

opinion of the Commissioner, it is desirable in the

public interest to publish such information.

153. Any officer not below the rank of Assistant

Commissioner may, having regard to the nature and

complexity of the case and the interest of revenue,

take assistance of any expert at any stage of scrutiny,

inquiry, investigation or any other proceedings before

him.

Taking assistance

from an expert.

154. The Commissioner or an officer authorised by him

may take samples of goods from the possession of any

taxable person, where he considers it necessary, and

provide a receipt for any samples so taken.

Power to take

samples.

155. Where any person claims that he is eligible for

input tax credit under this Act, the burden of proving

such claim shall lie on such person.

Burden of Proof.

45 of 1860.

156. All persons discharging functions under this Act

shall be deemed to be public servants within the

meaning of section 21 of the Indian Penal Code.

Persons deemed to be

public servants.

157. (1) No suit, prosecution or other legal proceedings

shall lie against the President, State President,

Members, officers or other employees of the

Appellate Tribunal or any other person authorised by

the said Appellate Tribunal for anything which is in

good faith done or intended to be done under this Act

or the rules made there under.

Protection of action

taken under this Act.

(2) No suit, prosecution or other legal proceedings

shall lie against any officer appointed or

authorised under this Act for anything which is

done or intended to be done in good faith under

174

this Act or the rules made there under.

158. (1) All particulars contained in any statement

made, return furnished or accounts or documents

produced in accordance with this Act, or in any record

of evidence given in the course of any proceedings

under this Act (other than proceedings before a

criminal court), or in any record of any proceedings

under this Act shall, save as provided in sub-section

(3), not be disclosed.

Disclosure of

information by a

public servant.

1 of 1872.

(2) Notwithstanding anything contained in the Indian

Evidence Act, 1872, no court shall, save as

otherwise provided in sub-section (3), require any

officer appointed or authorised under this Act to

produce before it or to give evidence before it in

respect of particulars referred to in sub-section

(1).

(3) Nothing contained in this section shall apply to

the disclosure of,––

45 of 1860.

49 of 1988.

(a) any particulars in respect of any statement,

return, accounts, documents, evidence, affidavit or

deposition, for the purpose of any prosecution under

the Indian Penal Code or the Prevention of Corruption

Act, 1988, or any other law for the time being in force;

or

(b) any particulars to the Central Government or

the State Government or to any person acting in the

implementation of this Act, for the purposes of

carrying out the objects of this Act; or

(c) any particulars when such disclosure is

occasioned by the lawful exercise under this Act of any

process for the service of any notice or recovery of any

demand; or

(d) any particulars to a civil court in any suit or

proceedings, to which the Government or any authority

under this Act is a party, which relates to any matter

arising out of any proceedings under this Act or under

any other law for the time being in force authorising

any such authority to exercise any powers there under;

or

175

(e) any particulars to any officer appointed for the

purpose of audit of tax receipts or refunds of the tax

imposed by this Act; or

(f) any particulars where such particulars are

relevant for the purposes of any inquiry into the

conduct of any officer appointed or authorised under

this Act, to any person or persons appointed as an

inquiry officer under any law for the time being in

force; or

(g) any such particulars to an officer of the Central

Government or of any State Government, as may be

necessary for the purpose of enabling that Government

to levy or realise any tax or duty; or

(h) any particulars when such disclosure is

occasioned by the lawful exercise by a public servant

or any other statutory authority, of his or its powers

under any law for the time being in force; or

(i) any particulars relevant to any inquiry into a

charge of misconduct in connection with any

proceedings under this Act against a practising

advocate, a tax practitioner, a practising cost

accountant, a practising chartered accountant, a

practising company secretary to the authority

empowered to take disciplinary action against the

members practising the profession of a legal

practitioner, a cost accountant, a chartered accountant

or a company secretary, as the case may be; or

(j) any particulars to any agency appointed for the

purposes of data entry on any automated system or for

the purpose of operating, upgrading or maintaining any

automated system where such agency is contractually

bound not to use or disclose such particulars except for

the aforesaid purposes; or

(k) any such particulars to an officer of the

Government as may be necessary for the purposes of

any other law for the time being in force; and

(l) Any information relating to any class of taxable

persons or class of transactions for publication, if, in

the opinion of the Commissioner, it is desirable in the

176

public interest, to publish such information.

159. (1) If the Commissioner, or any other officer

authorised by him in this behalf, is of the opinion that

it is necessary or expedient in the public interest to

publish the name of any person and any other

particulars relating to any proceedings or prosecution

under this Act in respect of such person, it may cause

to be published such name and particulars in such

manner as it thinks fit.

Publication of

information in respect

of persons in certain

cases.

(2) No publication under this section shall be made in

relation to any penalty imposed under this Act

until the time for presenting an appeal to the

Appellate Authority under section 107 has expired

without an appeal having been presented or the

appeal, if presented, has been disposed of.

Explanation.––In the case of firm, company or other

association of persons, the names of the partners of the

firm, directors, managing agents, secretaries and

treasurers or managers of the company, or the members of

the association, as the case may be, may also be published

if, in the opinion of the Commissioner, or any other

officer authorised by him in this behalf, circumstances of

the case justify it.

160. (1) No assessment, re-assessment, adjudication,

review, revision, appeal, rectification, notice,

summons or other proceedings done, accepted, made,

issued, initiated, or purported to have been done,

accepted, made, issued, initiated in pursuance of any

of the provisions of this Act shall be invalid or

deemed to be invalid merely by reason of any mistake,

defect or omission therein, if such assessment, re-

assessment, adjudication, review, revision, appeal,

rectification, notice, summons or other proceedings

are in substance and effect in conformity with or

according to the intents, purposes and requirements of

this Act or any existing law.

Assessment

proceedings, etc. not

to be invalid on

certain grounds.

(2) The service of any notice, order or communication

shall not be called in question, if the notice, order

or communication, as the case may be, has already

been acted upon by the person to whom it is

issued or where such service has not been called

177

in question at or in the earlier proceedings

commenced, continued or finalised pursuant to

such notice, order or communication.

161. Without prejudice to the provisions of section 160,

and notwithstanding anything contained in any other

provisions of this Act, any authority, who has passed

or issued any decision or order or notice or certificate

or any other document, may rectify any error which is

apparent on the face of record in such decision or

order or notice or certificate or any other document,

either on its own motion or where such error is

brought to its notice by any officer appointed under

this Act or an officer appointed under the Central

Goods and Services Tax Act or by the affected person

within a period of three months from the date of issue

of such decision or order or notice or certificate or any

other document, as the case may be:

Rectification of errors

apparent on the face

of record.

Provided that no such rectification shall be done after a

period of six months from the date of issue of such

decision or order or notice or certificate or any other

document:

Provided further that the said period of six months

shall not apply in such cases where the rectification is

purely in the nature of correction of a clerical or

arithmetical error, arising from any accidental slip or

omission:

Provided also that where such rectification adversely

affects any person, the principles of natural justice shall

be followed by the authority carrying out such

rectification.

162. Save as provided in sections117 and 118, no civil

court shall have jurisdiction to deal with or decide any

question arising from or relating to anything done or

purported to be done under this Act.

Bar on jurisdiction of

civil courts.

163. Wherever a copy of any order or document is to be

provided to any person on an application made by him

for that purpose, there shall be paid such fee as may

be prescribed.

Levy of fee.

164. (1) The Government may, on the Power of

178

recommendations of the Council, by notification,

make rules for carrying out the provisions of this Act.

Government to make

rules.

(2) Without prejudice to the generality of the

provisions of sub-section (1), the Government

may make rules for all or any of the matters which

by this Act are required to be, or may be,

prescribed or in respect of which provisions are to

be or may be made by rules.

(3) The power to make rules conferred by this section

shall include the power to give retrospective effect

to the rules or any of them from a date not earlier

than the date on which the provisions of this Act

come into force.

(4) Any rules made under sub-section (1) or sub-

section (2) may provide that a contravention

thereof shall be liable to a penalty not exceeding

ten thousand rupees.

165. The Government may, by notification, make

regulations consistent with this Act and the rules made

there under to carry out the provisions of this Act.

Power to make

regulations.

166. Every rule made by the Government, every

regulation made by the Government and every

notification issued by the Government under this Act,

shall be laid, as soon as may be after it is made or

issued, before the State Legislature, while it is in

session, for a total period of thirty days which may be

comprised in one session or in two or more successive

sessions, and if, before the expiry of the session

immediately following the session or the successive

sessions aforesaid, the State Legislature agrees in

making any modification in the rule or regulation or in

the notification, as the case may be, or the State

Legislature agrees that the rule or regulation or the

notification should not be made, the rule or regulation

or notification, as the case may be, shall thereafter

have effect only in such modified form or be of no

effect, as the case may be; so, however, that any such

modification or annulment shall be without prejudice

to the validity of anything previously done under that

rule or regulation or notification, as the case may be.

Laying of rules,

regulations and

notifications.

179

167. The Commissioner may, by notification, direct

that subject to such conditions, if any, as may be

specified in the notification, any power exercisable by

any authority or officer under this Act may be

exercisable also by another authority or officer as may

be specified in such notification.

Delegation of

powers.

168. The Commissioner may, if he considers it

necessary or expedient so to do for the purpose of

uniformity in the implementation of this Act, issue

such orders, instructions or directions to the State tax

officers as it may deem fit, and thereupon all such

officers and all other persons employed in the

implementation of this Act shall observe and follow

such orders, instructions or directions.

Power to issue

instructions or

directions.

169. (1) Any decision, order, summons, notice or other

communication under this Act or the rules made there

under shall be served by any one of the following

methods, namely:--

Service of notice in

certain

circumstances.

(a) by giving or tendering it directly or by a

messenger including a courier to the addressee or the

taxable person or to his manager or authorised

representative or an advocate or a tax practitioner

holding authority to appear in the proceedings on

behalf of the taxable person or to a person regularly

employed by him in connection with the business, or to

any adult member of family residing with the taxable

person; or

(b) by registered post or speed post or courier with

acknowledgement due, to the person for whom it is

intended or his authorised representative, if any, at his

last known place of business or residence; or

(c) by sending a communication to his e-mail

address provided at the time of registration or as

amended from time to time; or

(d) by making it available on the common portal;

or

(e) by publication in a newspaper circulating in the

locality in which the taxable person or the person to

180

whom it is issued is last known to have resided, carried

on business or personally worked for gain; or

(f) if none of the modes aforesaid is practicable, by

affixing it in some conspicuous place at his last known

place of business or residence and if such mode is not

practicable for any reason, then by affixing a copy

thereof on the notice board of the office of the

concerned officer or authority who or which passed

such decision or order or issued such summons or

notice.

(2) Every decision, order, summons, notice or any

communication shall be deemed to have been

served on the date on which it is tendered or

published or a copy thereof is affixed in the

manner provided in sub-section (1).

(3) When such decision, order, summons, notice or

any communication is sent by registered post or

speed post, it shall be deemed to have been

received by the addressee at the expiry of the

period normally taken by such post in transit

unless the contrary is proved.

170. The amount of tax, interest, penalty, fine or any

other sum payable, and the amount of refund or any

other sum due, under the provisions of this Act shall

be rounded off to the nearest rupee and, for this

purpose, where such amount contains a part of a rupee

consisting of paisa, then, if such part is fifty paisa or

more, it shall be increased to one rupee and if such

part is less than fifty paisa it shall be ignored.

Rounding off of tax

etc.

171. (1) Any reduction in rate of tax on any supply of

goods or services or the benefit of input tax credit

shall be passed on to the recipient by way of

commensurate reduction in prices.

Anti-profiteering

Measure.

(2) The Central Government may, on

recommendations of the Council, by notification,

constitute an Authority, or empower an existing

Authority constituted under any law for the time

being in force, to examine whether input tax

credits availed by any registered person or the

reduction in the tax rate have actually resulted in a

181

commensurate reduction in the price of the goods

or services or both supplied by him.

(3) The Authority referred to in sub-section (2) shall

exercise such powers and discharge such

functions as may be prescribed.

172. (1) If any difficulty arises in giving effect to any

provisions of this Act, the Government may, on the

recommendations of the Council, by a general or a

special order published in the Official Gazette, make

such provisions not inconsistent with the provisions of

this Act or the rules or regulations made there under,

as may be necessary or expedient for the purpose of

removing the said difficulty:

Removal of

difficulties.

Provided that no such order shall be made after the

expiry of a period of three years from the date of

commencement of this Act.

(2) Every order made under this section shall be laid,

as soon as may be, after it is made, before the

State Legislature.

Omissions,

substitutions,

and insertions

in the Acts to

be entered

here

Section-173

Save as otherwise provided in this Act, on and

from the date of Commencement of this Act,-

(i) In The Uttar Pradesh Municipal Corporation

Act 1959 clause (b) of sub section (2) of section

172 and section 192, 193 shall be omitted.

(ii) In The Uttar Pradesh Municipalities Act 1916

clause (7) of sub section (2) of section 128 shall

be omitted.

(iii) In The Uttar Pradesh Taxation and Land

Revenue Laws Act-1975, Chapter II shall be

omitted.

(iv) In The Uttar Pradesh Sugarcane Purchase Tax

Act, 1961 section 3, 3A, 3AA, 7(1A), 13, 14, 14A

shall be omitted.

Amendment of

certain Acts.

List of other

Acts to be

repealed to be

Section-174

(1) Save as otherwise provided in this Act, on and

Repeal and saving.

182

entered here from the date of Commencement of this Act

(i) The Uttar Pradesh Value Added Tax Act-

2008, except in respect of goods included

in the Entry 54 of the State List of the

Seventh Schedule to the Constitution,

(ii) The Uttar Pradesh Tax on Entry of goods

into local areas Act 2007

(iii) The Uttar Pradesh Entertainment and

Betting Tax Act, 1979

(iv) The Uttar Pradesh Advertisements Tax

Act, 1981

(v) The United Provinces Sales of Motor

Spirit, Diesel Oil and Alcohol Taxation

Act, 1939.

(Hereafter referred to as the repealed Acts) are

hereby repealed.

(2) The repeal of the said Acts and the amendment of

the Acts specified in section 173 (hereafter referred

to as “such amendment” or “amended Act”, as the

case may be) to the extent mentioned in sub-section

(1) or section 173 shall not—

(a) revive anything not in force or existing at the

time of such amendment or repeal; or

(b) affect the previous operation of the amended

Acts or repealed Acts and orders or anything duly done

or suffered there under; or

(c) affect any right, privilege, obligation, or

liability acquired, accrued or incurred under the

amended Acts or repealed Acts or orders under such

repealed or amended Acts:

Provided that any tax exemption granted as an

incentive against investment through a notification

shall not continue as privilege if the said notification is

rescinded on or after the appointed day; or

(d) affect any tax, surcharge, penalty, fine, interest

as are due or may become due or any forfeiture or

punishment incurred or inflicted in respect of any

183

offence or violation committed against the provisions

of the amended Acts or repealed Acts; or

(e) affect any investigation, inquiry, verification

(including scrutiny and audit), assessment proceedings,

adjudication and any other legal proceedings or

recovery of arrears or remedy in respect of any such

tax, surcharge, penalty, fine, interest, right, privilege,

obligation, liability, forfeiture or punishment, as

aforesaid, and any such investigation, inquiry,

verification (including scrutiny and audit), assessment

proceedings, adjudication and other legal proceedings

or recovery of arrears or remedy may be instituted,

continued or enforced, and any such tax, surcharge,

penalty, fine, interest, forfeiture or punishment may be

levied or imposed as if these Acts had not been so

amended or repealed; or

(f) affect any proceedings including that

relating to an appeal, revision, review or reference,

instituted before, on or after the appointed day

under the said amended Acts or repealed Acts and

such proceedings shall be continued under the said

amended Acts or repealed Acts as if this Act had

not come into force and the said Acts had not been

amended or repealed.

10 of 1897.

(3) The mention of the particular matters referred

to in section 173 and sub-section (1) shall not be

held to prejudice or affect the general application

of section 6 of the Uttar Pradesh General Clauses

Act, 1904 with regard to the effect of repeal.

184

SCHEDULE I

[See section 7]

ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE

WITHOUT CONSIDERATION

1. Permanent transfer or disposal of business assets where input

tax credit has been availed on such assets.

2. Supply of goods or services or both between related persons or

between distinct persons as specified in section 25, when made in

the course or furtherance of business:

Provided that gifts not exceeding fifty thousand rupees in value in

a financial year by an employer to an employee shall not be treated

as supply of goods or services or both.

3. Supply of goods—

(a) by a principal to his agent where the agent undertakes to supply

such goods on behalf of the principal; or

(b) by an agent to his principal where the agent undertakes to

receive such goods on behalf of the principal.

4. Import of services by a taxable person from a related person or

from any of his other establishments outside India, in the course or

furtherance of business.

185

SCHEDULE II

[See section7]

ACTIVITIES TO BE TREATED AS SUPPLY OF GOODS OR

SUPPLY OF SERVICES

1. Transfer

(a) any transfer of the title in goods is a supply of goods;

(b) any transfer of right in goods or of undivided share in goods

without the transfer of title thereof, is a supply of services;

(c) any transfer of title in goods under an agreement which

stipulates that property in goods shall pass at a future date upon

payment of full consideration as agreed, is a supply of goods.

2. Land and Building

(a) any lease, tenancy, easement, licence to occupy land is a supply

of services;

(b) any lease or letting out of the building including a commercial,

industrial or residential complex for business or commerce, either

wholly or partly, is a supply of services.

3. Treatment or process

Any treatment or process which is applied to another person’s

goods is a supply of services.

4. Transfer of business

assets

(a) where goods forming part of the assets of a business are

transferred or disposed of by or under the directions of the person

carrying on the business so as no longer to form part of those

assets, whether or not for a consideration, such transfer or disposal

is a supply of goods by the person;

(b) where, by or under the direction of a person carrying on a

business, goods held or used for the purposes of the business are

put to any private use or are used, or made available to any person

for use, for any purpose other than a purpose of the business,

whether or not for a consideration, the usage or making available

of such goods is a supply of services;

(c) where any person ceases to be a taxable person, any goods

forming part of the assets of any business carried on by him shall

be deemed to be supplied by him in the course or furtherance of his

business immediately before he ceases to be a taxable person,

186

20 of 1972

unless—

(i) the business is transferred as a going concern to another person;

or

(ii) The business is carried on by a personal representative who is

deemed to be a taxable person.

5. Supply of services

The following shall be treated as supply of service, namely:--

(a) renting of immovable property;

(b) construction of a complex, building, civil structure or a part

thereof, including a complex or building intended for sale to a

buyer, wholly or partly, except where the entire consideration has

been received after issuance of completion certificate, where

required, by the competent authority or after its first occupation,

whichever is earlier.

Explanation.––For the purposes of this clause––

(1) the expression "competent authority" means the Government or

any authority authorised to issue completion certificate under any

law for the time being in force and in case of non-requirement of

such certificate from such authority, from any of the following,

namely:–

(i) an architect registered with the Council of Architecture

constituted under the Architects Act, 1972; or

(ii) a chartered engineer registered with the Institution of Engineers

(India); or

(iii) a licensed surveyor of the respective local body of the city or

town or village or development or planning authority;

(2) the expression "construction" includes additions, alterations,

replacements or re modeling of any existing civil structure;

(c) temporary transfer or permitting the use or enjoyment of any

intellectual property right;

(d)development, design, programming, customisation, adaptation,

upgradation, enhancement, implementation of information

technology software;

(e)agreeing to the obligation to refrain from an act, or to tolerate an

act or a situation, or to do an act; and

(f) transfer of the right to use any goods for any purpose (whether

or not for a specified period) for cash, deferred payment or other

valuable consideration.

187

6. Composite supply

The following composite supplies shall be treated as a supply of

services, namely:—

(a) works contract as defined in clause (119) of section 2; and

(b) supply, by way of or as part of any service or in any other

manner whatsoever, of goods, being food or any other article for

human consumption or any drink (other than alcoholic liquor for

human consumption), where such supply or service is for cash,

deferred payment or other valuable consideration.

7. Supply of Goods

The following shall be treated as supply of goods, namely:--

Supply of goods by any unincorporated association or body of

persons to a member thereof for cash, deferred payment or other

valuable consideration.

188

SCHEDULE III

[See section7]

ACTIVITIES OR TRANSACTIONS WHICH SHALL BE

TREATED NEITHER AS A SUPPLY OF GOODS NOR A

SUPPLY OF SERVICES

1. Services by an employee to the employer in the course of or in

relation to his employment.

2. Services by any court or Tribunal established under any law for

the time being in force.

3.(a) the functions performed by the Members of Parliament,

Members of State Legislature, Members of Panchayats, Members

of Municipalities and Members of other local authorities;

(b) the duties performed by any person who holds any post in

pursuance of the provisions of the Constitution in that capacity; or

(c) the duties performed by any person as a Chairperson or a

Member or a Director in a body established by the Central

Government or a State Government or local authority and who is

not deemed as an employee before the commencement of this

clause.

4. Services of funeral, burial, crematorium or mortuary including

transportation of the deceased.

5. Sale of land and, subject to clause (b) of paragraph 5 of

Schedule II, sale of building.

6. Actionable claims, other than lottery, betting and gambling.

Explanation.––For the purposes of paragraph 2, the term “court”

includes District Court, High Court and Supreme Court.